* Q2 adjusted EPS 41 cents; Street view 37 cents
* Expenses down 20 percent
* Stands by full-year forecast
* Shares up 5.6 pct
(Adds conference call comments, analyst quote, timeshare
NEW YORK, July 29 Wyndham Worldwide Corp
(WYN.N), operator of Ramada, Days Inn and Super 8 hotels,
posted better-than-expected quarterly profit on Wednesday as
expenses dropped 20 percent.
Wyndham, the world's largest timeshare operator, also
affirmed its full-year earnings outlook, citing its emphasis on
midscale and economy chains, and its shares rose 5.6 percent.
"Generally, when things are tough, (people) tend to look
for ways to get more value for their money," Chief Executive
Stephen Holmes said in a phone interview.
The company posted second-quarter net profit of $71
million, or 39 cents a share, compared with $98 million, or 55
cents a share, a year earlier.
Excluding one-time items, earnings were 41 cents per share,
besting analysts' average forecast of 37 cents, according to
Reuters Estimates. Wyndham's own forecast was 36 cents to 41
cents per share.
Revenue slumped 19 percent to $920 million, but expenses
were cut to $769 million from $961 million.
Wyndham said it expects to earn 53 cents to 57 cents per
share in the third quarter. Analysts expect 58 cents.
It expects full-year revenue of $3.5 billion to $3.9
billion and adjusted EBITDA of $760 million to $810 million.
Holmes said the company trimmed costs in the second quarter
by adding technology that smoothed the process of exchanging
timeshares, saving a "couple million dollars" during the
Wyndham also saw the benefit of the restructuring of its
international operations that it launched last year, and a
cutback in its timeshare business.
During a conference call, the company said revenue per
available room (RevPAR) at its hotels could fall between 12
percent and 14 percent this year from 2008, worse than the 6
percent to 10 percent drop it forecast previously.
But systemwide RevPAR rose in the second quarter from the
Wyndham shares were up 71 cents to $13.38 in midday trade
on the New York Stock Exchange.
Wyndham's timeshare business, also known as the vacation
ownership business, once did about $2 billion in sales, Holmes
said, but the company downsized the segment by cutting staff
and dramatically slowing development.
Sales for the segment have since shrank to about $1.2
billion, Holmes said.
"I don't think you'd see us go back up to $2 billion even
if the environment got a lot better," he said. "I think we're
going to have that business be a stable, slower-growing
FBR Capital Markets analyst Patrick Scholes said, "There's
certainly a bit of ambiguity out there about what ... next
year's timeshare earnings are going to look like."
(Reporting by Deepa Seetharaman; editing by Jeffrey Benkoe and