Starwood Reports Strong Second Quarter 2007 Results

Second Quarter 2007 Highlights

• Excluding special items, EPS from continuing operations was $0.82 compared to $0.74 for the second quarter of 2006. Including special items, EPS from continuing operations was $0.67 compared to $3.01 in the second quarter of 2006. Special items in 2006 net to a $511 million benefit, or $2.27 per share primarily due to significant one-time income tax benefits realized in connection with the sale of 33 hotels to Host Hotels & Resorts (“Host”) during the period.
• Worldwide System-wide REVPAR for Same-Store Hotels increased 8.4% compared to the second quarter of 2006. System-wide REVPAR for Same-Store Hotels in North America increased 5.0%.
• Worldwide REVPAR for Starwood branded Same-Store Owned Hotels increased 10.4%. REVPAR for Starwood branded Same-Store Owned Hotels in North America increased 6.1%.
• Margins at Starwood branded Same-Store Owned Hotels Worldwide and in North America improved 148 and 77 basis points, respectively, as compared to the second quarter of 2006.
• Management and franchise revenues increased 13.8% when compared to 2006.
• Reported revenues from vacation ownership and residential sales increased 17.1% when compared to 2006. Strong increases in revenues from vacation ownership sales were partially offset by a decline in residential sales.
• Excluding special items, income from continuing operations was $178 million compared to $169 million in the same period of 2006. Net income, including special
• items, was $145 million compared to $680 million in the second quarter of 2006.
• Total Company Adjusted EBITDA was $362 million when compared to $332 million in 2006.
• During the second quarter, the Company repurchased 6.8 million shares at a cost of $471 million.
• The Company signed 33 hotel management and franchise contracts in the quarter representing approximately 7,000 rooms.