Host Hotels & Resorts Q4 Profit Surges, Guides FY14 In Line

(RTTNews) - Host Hotels & Resorts (HST), a lodging real estate investment trust, Wednesday reported a surge in fourth-quarter profit, as lower expenses helped offset a drop in revenues. Further, the company guided full year earnings in line with view.

Net income attributable to the company surged to $123 million from last year's $15 million. Earnings per share grew to $0.16 from $0.02. Adjusted loss per share was $0.04 last year. Excluding debt extinguishment costs and other expenses, adjusted Funds from Operations or FFO per share was $0.33 while it totaled $0.30 last year. On average, 23 analysts polled by Thomson Reuters expected earnings per share of $0.31 for the quarter. Analysts' estimates typically exclude one-time items. Total revenues declined to $1.331 billion from $1.673 billion in the previous year. Analysts estimated revenues of $1.30 billion.

The company's owned hotel revenues increased 7.5 percent from last year's adjusted figures, reflecting a 6 percent revenue improvement at the company's comparable hotels.

Rooms generated $838 million in the quarter, compared to $1.015 billion last year, while Food and beverage revenues fell to $407 million from $485 million. Comparable hotel REVenue Per Available Room or RevPAR increased 6.2 percent with average room rates improving 4.1 percent. Occupancy improved 1.5 percentage points to 73 percent.

On a currency-neutral basis, RevPAR increased 6.6 percent, reflecting strong improvements in average room rates, coupled with continued occupancy growth.

Total operating costs and expenses declined to $1.193 billion from $1.565 billion, helped by lower expenses for rooms, food and beverage and Other departmental and support expenses. Other property-level expenses as well as Depreciation and amortization declined in the quarter.

The company had incurred a $60 million impairment expense in 2012 related to the Westin Mission Hills Resort & Spa. On February 18, the Board of Directors authorized a regular quarterly cash dividend of $0.14 per share on its common stock, to be paid on April 15.

Looking ahead to 2014, the company expects adjusted FFO per share in the range of $1.40 to $1.44. earnings per share are estimated to be between $0.63 and $0.68. Analysts expect earnings of $1.43 per share for the year. HST closed down 0.7 percent on Tuesday at $18.86.