DOW JONES NEWSWIRES
Host Hotels & Resorts Inc. (HST) swung to a second-quarter
loss on write-downs as demand tumbled with consumers and businesses
continuing to cut spending.
That prompted the real-estate investment trust to lower its 2009
earnings outlook a second time. It now sees a loss of 46 cents to
53 cents a share and funds from operations of 43 cents to 50 cents,
based on an 20% to 23% drop in revenue per available room (revpar).
Host Hotels in April lowered its downbeat estimates to a loss of 34
cents to 41 cents and FFO - a key REIT profitability measurement -
of 68 cents to 76 cents, based on an 18% to 20% drop in revpar.
Commercial REITs have slammed by the global recession. Hoteliers
have been among the worst hit as they struggle to fill rooms with
operators slashing expenses and reducing their capital spending
plans to help offset the decline.
Host Hotels owns 126 hotels world-wide and hires operating
companies such as Marriott International Inc. (MAR) or Hilton
Hotels Corp. to manage them.
The highly leveraged REIT reported a loss of $68 million, or 12
cents a share, compared with prior-year earnings of $183 million or
34 cents a share. The latest period included 16 cents in
write-downs. FFO tumbled to 12 cents from 55 cents amid 24 cents in
write-downs and other charges.
Revenue decreased 23% to $1.06 billion.
Analysts polled by Thomson Reuters most recently were looking
for earnings of 2 cents, FFO of 24 cents and revenue of $1.08
billion.
Shares closed at $8.36 on Tuesday and didn't trade premarket.
The stock is down by roughly half in the past 10 months, though
it's nearly tripled since hitting a low of $3.08 in March.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
tess.stynes@dowjones.com