Starwood reports Q1 2011 increase in RevPAR

Starwood Hotels & Resorts Worldwide reported their first quarter 2011 financial results, marking an increase in system-wide RevPAR and a major increase in management fees as income.

First quarter 2011 highlights from Starwood include:
- Excluding special items, EPS from continuing operations was $0.30. Including special items, EPS from continuing operations was $0.15.
- Adjusted EBITDA was $208 million. Excluding special items, income from continuing operations was $58 million.
Including special items, income from continuing operations was $29 million.
- Worldwide System-wide REVPAR for Same-Store Hotels increased 10.4 percent (9.1 percent in constant dollars) compared to 2010. System-wide REVPAR for Same-Store Hotels in North America increased 11.1 percent (10.4 percent in constant dollars).
- Management fees, franchise fees and other income increased 15.7 percent compared to 2010.
- Worldwide Same-Store company-operated gross operating profit margins increased approximately 90 basis points compared to 2010. Gross operating profits were negatively impacted by events in the Middle East, North Africa and Japan.
- Worldwide REVPAR for Starwood branded Same-Store Owned Hotels increased 11.9 percent (10.2 percent in constant dollars) compared to 2010. REVPAR for Starwood branded Same-Store Owned Hotels in North America increased 9.6 percent (7.9 percent in constant dollars).
- Margins at Starwood branded Same-Store Owned Hotels Worldwide increased approximately 90 basis points compared to 2010. Excluding Latin America, which was impacted by the increasing gap between inflation and currency devaluation, margins increased over 210 basis points.
- Earnings from our vacation ownership and residential business increased $10 million compared to 2010.
- During the quarter, the Company signed 29 hotel management and franchise contracts representing approximately 8,700 rooms and opened 21 hotels and resorts with approximately 5,200 rooms.

Starwood reported EPS from continuing operations for the first quarter of 2011 of $0.15 per share compared to $0.16 in the first quarter of 2010. Excluding special items, EPS from continuing operations was $0.30 for the first quarter of 2011 compared to $0.13 in the first quarter of 2010. Special items in the first quarter of 2011, which totaled $33 million (pre-tax), primarily relate to a charge associated with the Company’s minority investment in a hotel in Tokyo, Japan following the earthquake in March 2011. Excluding special items, the effective income tax rate in the first quarter of 2011 was 21.0 percent, compared to 14.5 percent in the first quarter of 2010.

Income from continuing operations was $29 million in the first quarter of 2011 compared to $30 million in the first quarter of 2010. Excluding special items, income from continuing operations was $58 million in the first quarter of 2011 compared to $24 million in the first quarter of 2010.
Net income was $28 million and $0.14 per share in the first quarter of 2011 compared to $30 million and $0.16 per share in the first quarter of 2010.

Frits van Paasschen, CEO said, “We were able to exceed expectations despite turmoil in North Africa and the Middle East and the devastating earthquake in Japan. This is thanks to our laser-focus on growing faster than the market and flowing this outperformance down to the bottom-line.”

“The outlook for the rest of the year looks promising as we view the events of the past few months as not having derailed the overall global economic recovery. For example, our group and transient bookings remain robust. As such, we remain cautiously confident for 2011 and are bullish about our long-term prospects.”

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