Wyndham profit up but outlook faces 'uncertainty'
In a rare bit of good news for the battered hotel/time-share industry, Wyndham Worldwide reported a healthy bounce in third-quarter profit Thursday,
Wyndham profit up but outlook faces 'uncertainty'
By William Spain,
MarketWatch
Last update: 10:12 a.m. EDT Oct. 30, 2008Comments: 1CHICAGO
(MarketWatch) -- In a rare bit of good news for the battered hotel/time-share
industry, Wyndham Worldwide reported a healthy bounce in third-quarter profit
Thursday, sending the company's stock up more than 20% in early
action.
Before the start of trading, Wyndham (WYN:WYN
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said it earned $142 million, or 80 cents a share, during the period, up from
$117 million, or 65 cents a share, in the same quarter of last year. Adjusted to
exclude various items and restructuring costs, the company said it would have
earned 83 cents a share.
Revenue came in at $1.23 billion, compared to $1.22
billion a year earlier, as acquisitions helped offset a system-wide decline in
revenue-per-available-room (RevPAR) of 2.7%. That closely-watched metric was
down 4.2% domestically and 1.7% in the rest of the world.
The average
estimate of analysts polled by FactSet Research had been for Wyndham to earn 80
cents a share on revenue of $1.27 billion.
The results were "solid"
considering the "difficult global economic environment," Chief Executive Stephen
Holmes said in the earnings report. "We are taking the necessary steps to best
weather this storm and, if necessary, we will make further adjustments."
Looking ahead, the company said it expects to earn $2.12 to $2.17 for the
full year, slightly below the current Wall Street expectation of $2.18.
However, it also warned that "given the disruptions in the global economy
and capital markets, and ... how these will impact employment, consumer spending
and other macroeconomic drivers," that outlook is "subject to higher than normal
levels of uncertainty."
Shares of Wyndham were up $1.55 at $8.69. The stock
was trading north of $33 this time last year but cratered at less than $5
earlier this week.
William Spain is a MarketWatch staff writer in
Chicago.
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Comments: 1
Wyndham is a great company with excellent management
at the helm. Also, with it's timeshare component, it enjoys the personnel assets
and enduring success of the former Fairfield Resorts, Inc. which has always been
at the top in it's arena for 40 yr...
- DDX
