Starwood Hotels and Resorts Worldwide, Inc. today reported second quarter 2008 financial results. Among other things, revenues from vacation ownership and residential sales decreased 29.2% compared to 2007.
Starwood reported that originated contract sales of vacation ownership intervals (i.e., time shares) decreased 25.7% primarily due to the sellout of the Company’s Westin Ka’anapali Ocean Resort North in Maui and a decline in demand. The average price per vacation ownership unit sold decreased 19.1% to approximately $21,000, driven by a higher sales mix of lower priced biennial inventory in Hawaii. The number of contracts signed decreased 7.7% when compared to 2007.
Vacation ownership results were ahead of the Company’s expectations for the second quarter; however, the Company now expects that full year 2008 results will be lower than prior guidance (i.e., prediction of near-future profit or loss) due to lower sales in Hawaii and of its fractional product, as well as lower financing income.
Forbes reports that Starwood shares fell $4.63, or 11.6 percent, to $35.19 in afternoon trading Thursday, and that stock has fallen from a 52-week high of $74.05 last July to touch a low of $30.26 last week.