("Wyndham Worldwide 1Q Net Up 7.1% On Cost-Cutting," published
at 7:51 a.m. EDT, misstated the revenue figure in the sixth
paragraph. A corrected version follows.)
DOW JONES NEWSWIRES
Wyndham Worldwide Corp.'s (WYN) first-quarter net income rose
7.1% on lower costs while revenue fell as a result of continued
spending declines by consumers and businesses. Still, results for
the hotel and vacation timeshare group topped expectations.
The hotel industry has been cutting costs after getting hammered
last year, and the outlook for 2009 remains dire. Wyndham's
expenses dropped 12% from a year earlier.
The company is coming off a fourth-quarter loss that put it into
the red for 2008, on a write-down of its slumping timeshare
business. Rivals Starwood Hotels & Resorts Worldwide Inc. (HOT)
and Marriott International Inc. (MAR) also have reported weakness
at their timeshare units amid tight credit and as consumers remain
wary of real-estate purchases.
The operator of the Ramada, Howard Johnson and Days Inn hotel
chains reported net income of $45 million, or 25 cents a share, up
from $42 million, or 24 cents a share, a year earlier.
Excluding items such as restructuring costs and prior-year
write-downs, earnings rose to 41 cents from 35 cents. Wyndham in
February projected 35 cents to 40 cents, higher than analysts'
estimates at the time.
Revenue decreased 11% to $901 million amid streamlining of its
timeshare business and the effects of a stronger dollar. Analysts
polled by Thomson Reuters recently expected $839 million.
At its lodging business, total revenue per available room fell
13% in the U.S. and 5.5% internationally.
At its timeshare business, vacation-ownership interest sales
tumbled 35% amid a tight credit market and reduced marketing
efforts that led to fewer viewings.
The company, which affirmed its 2009 earnings forecasts,
forecast a second-quarter profit of 36 cents to 41 cents a share;
analysts expect 36 cents a share.
Wyndham shares closed at $8.76 on Tuesday and didn't trade
premarket The stock is down roughly 55% since September, but has
nearly quadrupled from a low in November.
-By Tess Stynes, Dow Jones Newswires; 201-938-2473;
tess.stynes@dowjones.com