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Marriott profit grows, but growth slowing in Asia

Marriott profit grows, but growth slowing in Asia

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NEW YORK — Marriott International Inc. is betting that it can grow earnings this year through higher bookings and rates despite slowing growth overseas

The Bethesda-based hotel company raised its profit expectation for the full year but reined in its prediction for fees for extras like Wi-Fi. It also says demand growth is slowing in the Middle East and in Asia, where economic growth is weakening. It’s particularly concerned about demand for higher-end hotels.

Worries about the wealthy cutting back on spending have surfaced in the last several months following warnings by luxury companies including jeweler Tiffany & Co.

Marriott made its prediction as it reported second-quarter net income that rose 6 percent from a year ago. Shares fell about 4 percent after the results were released.

Marriott, which also operates Ritz-Carlton hotels, Fairfield Inn & Suites and other lodging brands, earned $143 million, or 42 cents per share, in the 12 weeks that ended June 15, compared with $135 million, or 37 cents per share, a year earlier.

Revenue slipped 7 percent to $2.78 billion. Marriott had $564 million in revenue from its time-share business in the second quarter of 2011. That unit was spun off in November.

The company’s profit matched Wall Street’s estimate but revenue fell short of the expected $2.83 billion, according to FactSet.

Marriott’s results improved worldwide despite slowing economic growth. Revenue per available room rose 6.7 percent. It expects that metric — a key measure of performance for hotel companies — to grow 6 to 8 percent this year.

The company now predicts profit of $1.65 to $1.75 per share for all of 2012. Analysts expect $1.65. Three months ago, Marriott forecast earnings between $1.58 and $1.69 per share.

Marriott will offer more details on its financial performance and forecast for the year in a conference call with analysts Thursday morning.

The stock lost $1.58, or 4.1 percent, to $37.12 in after-hours trading Wednesday. The stock closed down 14 cents at $38.03 in regular trading.

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