Starwood reports strong fourth quarter and full year 2007 results
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Starwood reports strong fourth quarter and full year 2007 results
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Category: Worldwide -
This is a press release selected by our editorial committee and published online for free on 2008-02-04
Starwood Hotels & Resorts Worldwide, Inc. (NYSE: HOT) today reported strong fourth quarter 2007 financial results, driven by doubledigit
worldwide REVPAR increases and higher operating margins.
Fourth Quarter 2007 Highlights
Excluding special items, EPS from continuing operations was $0.79. Including
special items, EPS from continuing operations was $0.74.
Excluding special items, income from continuing operations was $157 million. Net
income, including special items, was $146 million.
Total Company Adjusted EBITDA was $361 million.
During the fourth quarter, the Company repurchased approximately 10.4 million
shares at a cost of $563 million.
Worldwide System-wide REVPAR for Same-Store Hotels increased 13.3%
compared to the fourth quarter of 2006. System-wide REVPAR for Same-Store
Hotels in North America increased 7.8%.
Worldwide REVPAR for Starwood branded Same-Store Owned Hotels increased
14.7% compared to the fourth quarter of 2006. REVPAR for Starwood branded
Same-Store Owned Hotels in North America increased 12.0%.
Margins at Starwood branded Same-Store Owned Hotels Worldwide and in North
America improved 154 and 234 basis points, respectively, as compared to the fourth
quarter of 2006.
Management and franchise revenues increased 19.9% when compared to 2006.
Reported revenues from vacation ownership and residential sales decreased 17.7%
when compared to 2006.
The Company signed 61 hotel management and franchise contracts in the quarter,
representing approximately 13,000 rooms. For the full year, the Company signed
197 hotel management and franchise contracts, representing approximately 47,000
rooms.
Starwood Hotels & Resorts Worldwide, Inc. (“Starwood” or the “Company”) today reported
EPS from continuing operations for the fourth quarter of 2007 of $0.74 compared to $0.94
in the fourth quarter of 2006. Excluding special items, EPS from continuing operations was
$0.79 for the fourth quarter of 2007 compared to $0.92 in the fourth quarter of 2006.
Strong hotel results in the fourth quarter of 2007 were offset by declines in the Company’s
vacation ownership and residential business, loss of earnings from hotels sold during the
past year, and a higher tax rate. Excluding special items, the effective income tax rate in
the fourth quarter of 2007 was 28.5%, compared to 21.4% in the same period of 2006
primarily related to the recognition in 2006 of certain tax credits generated in 2005.
Income from continuing operations was $146 million in the fourth quarter of 2007
compared to $203 million in 2006. Excluding special items, which net to a $11 million
charge in 2007, income from continuing operations was $157 million for the fourth quarter
of 2007 compared to $199 million in 2006.
Net income was $146 million and EPS was $0.74 in the fourth quarter of 2007 compared to
net income of $203 million and EPS of $0.93 in the fourth quarter of 2006.
Frits van Paasschen, CEO, said, “Starwood reported another terrific quarter, beating
guidance on strength in our core lodging business. Performance was broad-based, but
particularly strong in our international divisions, where system-wide RevPAR increased
20.2%. Our globally diversified pipeline grew to 120,000 rooms, and is skewed towards
high quality rooms in the upper upscale and luxury segments where our brands have a
commanding presence. Reflecting our commitment to return cash to our shareholders, we
bought back 10.4 million shares, or over 5% of our diluted share count in the quarter.
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