Starwood Hotels & Resorts Worldwide today lowered its annual revenue expectations as it reported a 16.4 percent drop in its profit for the second quarter of 2008.
Similar in pattern to results recently reported by Marriott International
(BTNonline, July 21), Starwood reported systemwide revenue per available room was up 9.6 percent, boosted largely by performance outside North America. RevPAR within North America was up 3 percent.
"Starwood's global footprint and strong brands drove the company's second-quarter results above expectations and ahead of our competition," CEO Frits van Paasschen said in a statement. "While international lodging demand remains solid, the economic picture in the U.S. has continued to deteriorate, with lodging demand dropping significantly in May."
For the full year, Starwood now expects for RevPAR to grow between 6 percent and 8 percent, with North American RevPAR growing in the 2 percent to 3 percent range. It also expects to open between 80 and 100 hotels with about 20,000 rooms by the end of 2008.
Smith Travel Research this week also released its full second-quarter results for the U.S. lodging industry. U.S. RevPAR was up 1.2 percent compared with the second quarter of 2007, average daily rate increased by 3.8 percent to $107.31 and occupancy dropped 2.5 percent to 65 percent.
Occupancy was down in all regions and hotel tiers. Rate growth, however, was strongest in the midprice with and without food and beverage tiers, with increases around 4 percent, and weakest in the luxury tier, up only 0.8 percent.