Boston, MA 05/01/2013 (wallstreetpr) – The luxury St. Regis and W brand-owner, Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT) (Closed: $64.52, Up by 3.30%) said that there was a 66 percent rise in its first-quarter earnings. This has been attributed to growth in North America as well as a tax benefit. In a statement, the Stanford, Connecticut-based company said that the net income rose from $128 million or 65 cents per share a year earlier, to $213 million or $1.09 per share. The average analyst estimate had been 53 cents.
Starwood said that its earnings had got a boost due to a tax benefit of $70 million. It said that room rates are being driven up by a tight supply in hotel rooms in the North American region. This has contributed to the 6.2 percent rise in the revenue per available room in the area. This is a standard measure of rates and occupancies. In an interview, Vasant Prabhu, the Chief Executive Officer said that the company had a healthy start in 2013 and that there had been acceleration in the global economy in the first-quarter. He added that the United States market had fuelled the company’s first quarter performance.
Sale proceeds boosted projections
The REVPAR rises in North America had outperformed the global gain of 5 percent, in constant dollars in the quarter. The Starwood shares gained 13 percent in the current year in comparison with the 6 percent rise in the Standard & Poor’s Supercomposite Hotels Index which comprises of seven members. There was a drop of 10 percent down to $1.54 billion in Starwood’s first-quarter revenue. The performance was buoyed by the sale of the Miami, Florida, St. Regis Bal Harbour Resort, vacation units which had opened in 2012 January. The company raised it full year forecasted adjusted earnings to $2.75-$2.83 per share in comparison with its February estimate of $2.59-$2.68 per share.
The company projected that the global REVPAR at the hotels it operates will rise 5-7 percent in the second quarter. The increase at its owned hotels will be in the range of 4-6 percent. The general economic turnaround in the U.S and across the world ha had a positive impact in the projections of many hospitality companies.