STAMFORD, Conn. (AP) -- Starwood Hotels, freed from huge charges it took last year, saw net income more than quadruple during the first quarter, easily beating Wall Street expectations.
Momentum began to pick up speed during the first months of the year, said CEO Frits van Paasschen, and Starwood is "very bullish" about long-term prospects.
"Going into the year, we said that 2012 was more likely to surprise on the upside," said Paasschen. "So far, that is playing out."
Starwood earned $128 million, or 65 cents per share. That's up from $28 million, or 14 cents per share, last year.
Excluding an $11 million legal reserve reduction and a $7 million loss on a hotel sale, earnings from continuing operations were 63 cents per share. That is a dime better per-share than analysts had forecast, according to a poll by FactSet, and it beat on revenue, too, which rose 32 percent to $1.72 billion.
The prior-year period included a $33 million charge, mostly from a minority investment in a Tokyo hotel following the devastating earthquake in Japan.
Global revenue per available room for hotels open at least a year increased 5.8 percent. Systemwide revenue per available room for hotels in North America open at least a year climbed 7.1 percent.
Revenue per available room is a key gauge of a hotel operator's health.
Total vacation ownership revenue rose 3.4 percent to $152 million in the quarter, with the number of contracts signed up 3.6 percent. Residential revenue surged to $362 million from $6 million, which accounts for the inclusion of revenue from its massive St. Regis Bal Harbour project.
"Seemingly unstoppable demographic and economic trends are fueling global growth in demand for high end travel," said Paasschen. "Rising wealth around the world and globally interconnected businesses will lead to ever more travel."
Starwood expects earnings this year of $2.35 to $2.46 per share and second-quarter earnings of 58 cents to 62 cents per share. Both forecasts include the Bal Harbour project.
However, Wall Street had been predicting annual earnings of $2.69 per share and 60 cents per share for the second quarter.
Its shares rose $2.15, or 3.7 percent, to close at $59.77 Thursday. Its shares are near the upper end of their 52-week range of $35.78 to $61.70.
Starwood Hotels & Resorts Worldwide Inc., which runs hotels under the St. Regis, Westin, Sheraton and other brands, is based in Stamford, Conn. It has 1,103 properties in almost 100 countries.