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Starwood Hotels & Resorts Worldwide Inc.'s (HOT) fourth-quarter net income tumbled 46% amid $133 million in restructuring charges and write-downs of timeshare projects and North American hotels as growth slowed worlwide.

As such the company lowered its 2009 outlook and forecast first-quarter earnings below analysts' expectations.

Hoteliers have been reducing their workforce, freezing wages and lowering or pulling guidance to combat what is expected to be a difficult year after the sector was hammered in 2008 amid steep cuts in airline capacity, a pullback in consumer spending and waning corporate travel.

Chief Executive Frits van Paasschen said Thursday that significant cost reductions the past year helped Starwood to post better-than-expected fourth-quarter results despite revenue per available room falling short of estimates. He added that "extensive cost cutting" at the property level will help offset some of the margin erosion that results from declining Revpar.

He added 2009 capital spending will tumble to $150 million from last year's $817 million as "the outlook for 2009 remains challenging, we are prepared for the worst."

As such, Starwood now sees earnings excluding items of $1.10, down from October's weak view of $1.55, amid an anticipated 12% drop in Revpar. The first quarter's earnings are seen at 2 cents to 7 cents a share, with Revpar falling 17%. Analysts surveyed by Thomson Reuters were projecting a 13-cent profit.

Meanwhile, the operator of hotels under the W Hotels, Westin, St. Regis and Sheraton brands reported fourth-quarter net income of $79 million, or 43 cents a share, compared with $146 million, or 74 cents a share, a year earlier. Excluding items inclding the restructuring costs and write-downs, earnings fell to 49 cents from 79 cents, yet thatwas still above October weak forecast of 36 cents to 42 cents.

Revenue dropped 17% to $1.33 billion. Analysts expected $1.4 billion.

Revenue per available room in hotels owned for at least a year decreased 20%, well below Starwood's forecast for a 4% to 6% drop.

Meanwhile, the downturn has hurt credit ratings for the lodging industry, with several hoteliers including Starwood, being lowered to junk. Starwood's stock has lost half its value the past four months and closed Wednesday at $17.41. The stock was inactive premarket.

-By Shirleen Dorman, Dow Jones Newswires; 201-938-2310; shirleen.dorman@dowjones.com

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