Expedia Inc. (NASDAQ: EXPE) reported that it’s first-quarter net income for 2009 fell 20% on a $9 million restructuring charge, even as revenue from both hotels and air travel declined.

Net income for Q1 2009 was $39.8 million (14 cents a share), as compared to $49.8 million (17 cents a share) for Q1 2008. Revenue dropped 7.6% to $635.7 million.

In a press statement, Dara Khosrowshahi, Expedia Inc.’s CEO and President, said that “Our results for the first quarter, especially the improved momentum in transaction and hotel room night volumes, prove that Expedia can successfully drive unit growth despite an undeniably difficult environment. Our global realignment of resources is well in motion, which we believe will only improve our operational effectiveness and efficiency over time.” 

Analysts have stated that Expedia is likely to show some gains and improve market share due to the elimination of booking fees and the on-going price war between the OTAs, which Expedia seems to be winning.

Meanwhile, Starwood Hotels & resorts Worldwide Inc. (NYSE: HOT) added to the misery of travel stocks by declaring Q1 earnings of 3 cents per share ($6 million), as compared to 17 cents per share ($32 million) for Q1 last year. Revenue dropped from $1.47 billion to $1.12 billion.
Worldwide system-wide RevPAR for same-store hotels decreased 23.5% (down
19.2% in constant dollars) compared to the first quarter of 2008. System-wide
REVPAR for same-store hotels in North America decreased 22.8% (down 21.0% in
constant dollars).

In a press statement, Starwood CEO Frits van Paasschen said that, “For the second quarter in a row, our pre-emptive cost cutting enabled us to beat expectations, even in the face of substantial declines in REVPAR. Looking past this economic crisis, we remain committed to our long-term growth strategy to create substantial value for our shareholders. By the end of this year, our system of hotels will cross the 1,000th hotel milestone, including 250 new openings and 350 renovated hotels since 2007, making us well-positioned to own the upswing as the global economy stabilizes.” 

Source:-
Expedia Inc. - link
Starwood Hotels & Resorts Worldwide, Inc. - link (pdf)

Posted on April 30th, 2009 by PLing
Filed under: Travel News