Starwood Hotels’ profits dip 17%

Starwood Hotels & Resorts said last week that its third-quarter profit fell nearly 17 percent on various charges and lower margins in North America. The hospitality behemoth also lowered its forward profit outlook.

Starwood, which owns or manages hotels under the Sheraton, St. Regis, Westin and W Hotels brands, said it earned $129 million, or 61 cents a share, down from $155 million, or 71 cents a share, in the year-ago period.

Revenue in the period rose 5.4 percent to $1.54 billion, helped by a 9.5 percent increase in revenue per available room in hotels owned for at least a year.

Margins at Starwood-owned hotels worldwide improved by 0.7 percentage points, although margins for those properties in the U.S. slipped due to some renovation work.

Management and franchise revenue increased 16.7 percent while that from vacation ownership and residential sales were flat when compared to 2006.