Starwood 1Q Net Slumps 82% On Falling Revpar; 2Q View Weak
Starwood Hotels & Resorts Worldwide Inc.'s (HOT) first-quarter net income tumbled 82% on shrinking revenue per available room and a drop in timeshare sales. While the quarter's profit topped downbeat expectations, the company projected second-quarter earnings of 14 cents to 20 cents. Analysts' mean estimate, as surveyed by Thomson Reuters, was 23 cents. The weak economy has squeezed the hotel industry for some time, with timeshare businesses also under pressure. The outlook for 2009 is grim, despite efforts by hoteliers, including Starwood, to cut costs. A recent swine flu outbreak could raise cancellations and depress bookings.