Profit declines for Aladdin co-bidder

Thursday, July 22, 2004 | 10:58 a.m.

BLOOMBERG NEWS

WHITE PLAINS, N.Y. -- Starwood Hotels & Resorts Worldwide Inc., owner of the Sheraton and Westin chains, today said second-quarter earnings fell 57 percent from a year earlier, when the sale of hotels boosted profit.

Net income dropped to $154 million, or 72 cents a share, from $290 million, or $1.41, a year ago, when sale of hotels in Italy and a related income-tax benefit increased earnings by $233 million. Revenue rose 13 percent to $1.36 billion, the White Plains-based company said in a statement.

Starwood is a part of a team bidding to acquire the Aladdin resort on the Las Vegas Strip out of bankruptcy.

Starwood's hotels in New York, Boston and San Francisco sold more rooms at higher rates to an increasing amount of business travelers, the company said. Chief Executive Barry Sternlicht's renovation of Westin and Sheraton hotels is helping the company attract more travelers, analysts said.

"Hotel managers are telling us they're having sellouts on Tuesday night and things are picking up on Monday and Wednesday," said Joseph Betlej, who manages $350 million in the Ivy Real Estate Securities Fund in St. Paul, Minn., including shares of Starwood. "Who fills rooms on those nights is business travelers."

Shares of Starwood rose 16 cents to $44.66 at 9:52 a.m. in New York Stock Exchange composite trading today. They had risen 24 percent this year.