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Share Name | Share Symbol | Market | Type |
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Wyndham Worldwide Corp Common Stock | AMEX:WYN | AMEX | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 0 | - |
DOW JONES NEWSWIRES
Wyndham Worldwide Corp. (WYN) swung to a fourth-quarter loss on a $1.3 billion write-down at its slumping timeshare business.
Wyndham, which again cut its 2009 revenue forecast but sees first-quarter earnings above expectations, and other hotel chains continue to be hammered by a pullback in consumer spending and waning corporate travel. Analysts say the hotel industry might not recover until 2011.
Weak results and outlooks from Wyndham rivals Marriott International Inc. (MAR) and Starwood Hotels & Resorts Worldwide Inc. (HOT) in particular underscore the growing vulnerability of the timeshare business for U.S. hotels amid continued consumer skittishness about buying real estate.
The three companies had consistently reaped big profits by financing timeshare purchases amid strong consumer demand. But with the lockdown in credit markets and concerns that consumers are shunning big-ticket purchases, developers have scaled back expansion plans in vacation ownership.
In mid-December, Wyndham said it would pare back its time-share operations, eliminating 4,000 jobs, in an effort to reduce its reliance on the troubled credit markets.
The hotel company - whose brands include Days Inn, Ramada and Howard Johnson - reported a net loss of $1.36 billion, or $7.63 a share, compared with year-earlier net income of $104 million, or 58 cents a share.
Excluding items including the write-down, earnings rose to 47 cents from 46 cents. The company in October projected 41 cents to 46 cents.
Revenue fell 12% to $911 million, reflecting the timeshare, increased loan-loan provisions and the stronger dollar.
Analysts polled by Thomson Reuters were more recently expecting earnings, excluding items, of 40 cents a share, on revenue of $989 million.
Revenue per available room, a key hotel-industry measure, fell 6.4%. The drop was 9.3% in the U.S. and 1.6% internationally.
Gross vacation-ownership interest sales dropped 11%. Wyndham said in December it planned to reduce such sales to $1.2 billion in 2009 from about $2 billion in 2008. At the time, Chairman and Chief Executive Stephen P. Holmes said the company was cutting back timeshare operations because of its assumption that asset-backed securities markets would be "unattractive for the foreseeable future."
For 2009, Wyndham expects earnings, excluding items, of $1.61 to $1.85 a share on revenue of $3.5 to $3.9 billion. In December it cut its revenue view to $3.7 billion to $4.1 billion. Wall Street was expecting earnings, excluding items, of $1.69 a share on revenue of $3.68 billion.
For the first quarter, the company sees earnings, excluding items, of 35 cents to 40 cents a share; analysts anticipated 31 cents.
Wyndham shares closed Thursday at $5.94 and there was no premarket trading. The stock is down more than 70% the past five months.
-By Mike Barris, Dow Jones Newswires; 201-938-5658; mike.barris@dowjones.com
1 Year Wyndham Worldwide Corp Common Stock Chart |
1 Month Wyndham Worldwide Corp Common Stock Chart |
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