Hotel and leisure company Starwood Hotels & Resorts Worldwide Inc. said on Thursday that its second-quarter profit fell 16.4 percent as demand fell, but its results beat Wall Street estimates.
Net income for the three months ended June 30 fell to $105 million, or 56 cents per share, from $145 million, or 67 cents per share, in the same period a year earlier.
Profit from continuing operations was $107 million, or 56 cents per share, compared with $145 million, or 82 cents per share, the prior year.
Analysts surveyed by Thomson Financial, on average, forecast earnings of 52 cents per share.
International demand remained solid for the company, but it dropped significantly in the United States in May, said Starwood CEO Frits van Paasschen.
The company is still bullish on its long-term growth, planning more than 120,000 rooms including almost 60 percent outside the United States. It signed 37 hotel management and franchise contracts representing approximately 9,000 rooms in the second quarter of 2008.
Starwood said revenue per available room increased 9.6 percent at comparable hotels worldwide and 3 percent in North America. Revenue per available room, also known as revpar, is a key gauge of a lodging company's performance.
During the second quarter, Starwood opened 21 new hotels and resorts, including the W Istanbul in Istanbul, Turkey, the Sheraton Huizhou Beach Resort in Guangdong, China, and three aloft hotels. Thirteen properties were removed from the system during the quarter.
Starwood stock closed Wednesday at $39.82. Shares have traded in a range between $30.26 and $71.68 in the last 52 weeks.
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