Hilton, Hotel Industry Report Strong Third-Quarter Results

Hilton Hotels Corp. today announced strong third-quarter results, with revenue per available room, a key indicator of hotel profitability, rising 7.3 percent for company-owned hotels, compared to the same period last year. Occupancy rates increased 2.7 percent, while average daily rate rose 3.5 percent.

Hilton's results correspond with overall U.S. industry results released last week by Smith Travel Research. Industry RevPAR grew 6.4 percent, year-over-year, according to STR, while occupancy and ADR increased 2.6 percent and 3.6 percent, respectively, very close to the numbers Hilton reported. The STR results reinforce the positive picture for hoteliers, at the expense of travel buyers, who are entering the final weeks of negotiations for 2005 rates.

Hilton's results also are consistent with the quarterly showing of Marriott International and Starwood Hotels & Resorts International, two multi-brand companies that released earnings in the past two weeks.

The full-service core Hilton brand and the Doubletree brand outperformed Hilton's midprice brands, which also is consistent with industry trends. Full-service hotels are more likely to be in downtown locations, which see the most bookings by business travelers. RevPAR for the Hilton brand increased 7.6 percent for the quarter, year-over-year, while Doubletree RevPAR rose 7.5 percent.

Hilton co-chairman and CEO Stephen Bollenbach attributed the strong performance to a rebound in travel. "Demand is getting stronger all the time," he said.