Wyndham Worldwide (NYSE:WYN) said its third-quarter profit rose 50% partially due to higher revenue per available room and rebounding consumer confidence, leading the company to raise its fiscal 2010 outlook.
The hotel and resort chain posted net income of $156 million, or 84 cents a share, compared with $104 million, or 57 cents a share, in the same quarter last year.
The results include an after-tax benefit of $38 million related to the resolution of the IRS examination involving Wyndham's former parent Cendant, partially offset by a $6 million after-tax loss incurred for the repurchase of a portion of its 3.5% convertible notes.
Excluding special items, earnings were up 68 cents, ahead of average analyst estimates of 63 cents, according to Thomson Reuters.
Wyndham, which operates the Ramada, Howard Johnson and Days Inn hotels, said the improved earnings reflect strong operational performance by the vacation ownership unit, higher revenue per available room, or RevPAR, in the lodging business, and a lower effective tax rate.
Revenue for the Parsippany, NJ-based company was $1.07 billion, up sharply from $323 million a year ago, matching the Streetâ€™s view.
â€śThis quarterâ€™s strong results reflect continued superior execution throughout our company and further strengthening of business fundamentals,â€ť said Wyndham CEO Stephen P. Holmes. â€śWe continue to deploy free cash flow in a disciplined manner to drive growth and deliver shareholder value, balancing tuck-in acquisitions, share repurchases, convertible debt retirement and dividends.â€ť
Given the strong results, the hotel chain raised its full-year earnings guidance to the range of $1.94 to $1.98 a share from Julyâ€™s forecast of $1.78 to $1.88 a share.