DOW JONES NEWSWIRES
Wyndham Worldwide Corp. (WYN) second-quarter earnings fell 28%
as a leisure and business travel slump continued to take a toll on
the company's hotel and timeshare businesses.
Hoteliers are struggling through a sharp industry downturn.
Major chains - including Marriott International Inc. (MAR), Host
Hotel & Resorts Inc. (HST) and Starwood Hotels & Resorts
Worldwide Inc. (HOT) - recently reported second-quarter
revenue-per-available-room figures that were down as much as a
third from the prior-year period.
Timeshare operators have found lower demand and more difficulty
financing sales, leading some to trim operations. Wyndham, which
owns 150 resorts globally and counts 830,000 time-share owners,
expects time-share sales down 40% this year to $1.2 billion - they
dropped 39% in the second quarter. Last year, the business provided
53% of revenue.
The operator of the Ramada, Howard Johnson and Days Inn hotel
chains reported profit of $71 million, or 39 cents a share, down
from $98 million, or 55 cents a share, a year earlier. Excluding
restructuring and other impacts, earnings fell to 41 cents from 53
cents. Wyndham was expecting 36 cents to 41 cents.
Revenue decreased 19% to $920 million on the time-share woes and
currency impacts. Analysts polled by Thomson Reuters most recently
were looking for $917 million.
At Wyndham's lodging business, total revenue per available room
on a constant-dollar basis fell 15%, dropping 14% in the U.S. and
18% internationally.
For the third quarter, the company expects earnings of 53 cents
to 57 cents, while analysts were looking for 57 cents. The company
reaffirmed its 2009 earnings forecasts.
Shares closed at $12.67 on Tuesday and didn't trade premarket.
The stock is down roughly 40% in the past 11 months, though it has
quintupled from an all-time low of $2.55 in November.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
tess.stynes@dowjones.com