(Reuters) – Hilton Worldwide Holdings Inc (HLT.N), owner of the Conrad and Waldorf Astoria hotel brands, reported a better-than-expected 7 percent rise in quarterly revenue, as increased business travel in United States drove up occupancy rates.
The increase in travel due to the strengthening U.S. economy has resulted in tight supply of hotel rooms. Hilton gets about three-quarters of its revenue from the United States.
Revenue per available room (RevPAR) increased 6.8 percent at U.S. hotels open for at least a year in the fourth quarter ended Dec. 31, Hilton said.
Worldwide comparable RevPAR rose 6.6 percent. RevPAR, a metric of hotel health, is calculated by multiplying a hotel’s average daily room rate by its occupancy rate.
Revenue rose to $2.83 billion from $2.64 billion a year earlier.
Net income attributable to shareholders rose to $158 million, or 16 cents per share, from $26 million, or 3 cents per share. On an adjusted basis, Hilton earned 17 cents per share.
Analysts on average expected a profit of 18 cents per share on revenue of $2.72 billion, according to Thomson Reuters I/B/E/S.
Hilton’s fourth-quarter 2013 profit was adjusted for $306 million of pre-tax general, administrative and other expense, and $23 million of pre-tax interest expense, offset by a pre-tax gain on debt extinguishment of $229 million and an $87 million income tax benefit.
The company said it expects an adjusted profit of 10-12 cents per share for the first quarter. Analysts were expecting a profit of 15 cents per share.
Rival Starwood Hotels & Resorts Worldwide Inc (HOT.N), owner of the Sheraton and Westin brands, which has nearly half its properties outside North America, blamed a strong dollar for its lower-than-expected full-year profit forecast of $2.87-$2.97 per share.
Hilton’s shares had risen about 10 percent this year up to Tuesday’s close of $28.65 on the New York Stock Exchange, outperforming an about 1 percent rise in the Dow Jones U.S. Travel & Leisure Index <.DJUSCG>.
(Reporting by Ankit Ajmera in Bengaluru; Editing by Joyjeet Das)
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