By Anastasia Tomazhenkova: Hotel owner Host Hotels & Resorts Inc posted its quarterly funds from operations rose, due to an increase in average room rates.
Host Hotels & Resorts Inc., the owner of 119 properties including Marriotts, Hiltons and Westins, announced fourth-quarter profit rose 50%.
Net income advanced to 294 million dollars, or 54 cents a share, from 196 million dollars, or 36 cents, a year earlier, the Bethesda, Maryland-based company said. Funds from operations, a measure of cash flow used by real estate investment trusts, rose more than analysts estimated.
Room rates climbed 6.4% as business travelers
Host Hotels, the largest U.S. hotel real estate investment trust, said fourth-quarter FFO was 75 cents a share, compared to 58 cents a share in the same quarter a year ago.
FFO, a widely accepted measure of real estate investment trust performance, removes the profit-reducing effects that depreciation - a non-cash accounting item - has on earnings.
Host fell 14 cents to 16.69 dollars at 9:55 a.m. in New York Stock Exchange composite trading. The shares declined 1.2% this year through yesterday.
The company lowered its growth-rate forecast for revenue per available room, a measure of rates and occupancy, to 2% to 4% for 2008 from October's estimate of 5% to 7%. Marriott International Inc. and Starwood Hotels & Resorts Worldwide Inc., which together manage 112 Host properties, have also lowered their 2008 Revpar forecasts.
Host forecast first-quarter earnings of 8 cents to 9 cents a share and full-year profit of 1.05 dollar to 1.14 dollar.