* Q1 adj EPS 63 cents vs Wall St estimate 52 cents
* Outlook raised for key measure
* Shares up 2 pct
April 26 (Reuters) – Starwood Hotels & Resorts Worldwide
topped profit estimates for the first quarter as
strength in the Americas helped offset softness in Europe, and
the company raised its outlook for a key revenue measure,
sending its shares up more than 2 percent.
A business-led recovery has helped lift U.S. hotel occupancy
rates and aided an industry whose financing challenges have
slowed construction.
Starwood, which franchises hotels under brands such as
Sheraton, W and Westin, was upbeat that travel is continuing on
an upswing fueled by the global economic recovery.
“Despite the headlines and uncertainty, our business is
better than some might think,” Chief Executive Officer Frits van
Paasschen told analysts during a conference call on Thursday.
“We believe we’re on the cusp of a golden age of global
travel,” van Paasschen added.
Starwood noted signs of improved bookings in key European
markets. It added the second half would likely be better in
Europe, which accounts for about 20 percent of Starwood
earnings.
“Based on what we’re seeing, we would expect the European
recession to be shallow, as some economic forecasters are now
predicting,” Chief Financial Officer Vasant Prabhu said.
Starwood projected growth of 6 percent to 8 percent in
worldwide revenue per available room, or revPAR, for
company-operated hotels open at least a year, up from a prior
forecast of a 5 percent to 7 percent increase. That metric
multiples occupancy rate by room rate.
Net income was $128 million, or 65 cents a share, in the
first quarter, compared with $28 million, or 14 cents a share, a
year earlier.
Excluding items, profit came to 63 cents a share. Analysts
on average expected 52 cents, according to Thomson Reuters
I/B/E/S.
Quarterly revenue rose 32 percent to $1.7 billion.
By region, revPAR rose 7.1 percent in North America, 14.4
percent in Latin America and 6.7 percent in Asia-Pacific.
Europe revPAR was down 1.9 percent.
The company said it expected a profit of $2.35 to $2.46 a
share before items for this year. Analysts expected $2.31.
Shares of Starwood Hotels were up 2.7 percent at $59.20 in
early afternoon trading as other major hotel companies rose.
Marriott International was up 1.2 percent and Hyatt
rose 2.8 percent.
