(Reuters) - Hilton Worldwide Holdings Inc reported quarterly profit and revenue that beat analysts’ estimates on Wednesday, as Asia Pacific led stronger growth in its operations outside the United States.
Shares of Hilton, owner of the Waldorf Astoria, Conrad and Double Tree hotel chains, rose 3.4 percent to $86 in premarket trading.
The hotel industry globally has been benefiting from an uptick in demand, especially from corporate travelers, as a strengthening global economy boosts sentiment and spending.
Hilton, which gets more than three-quarters of its revenue from the United States, said overall revenue per available room (RevPAR) rose 3.8 percent in the fourth quarter, as more people booked rooms at higher prices.
RevPAR is a key metric to measure a hotel’s financial health and is calculated by multiplying the average daily room rate by the occupancy rate.
Hilton’s strongest RevPAR growth was a 7.6 percent increase in the Asia Pacific. With a rise of 3.2 percent, the U.S. RevPAR growth was the slowest among Hilton’s five geographies.
The RevPAR growth was better-than-forecasted across the board, Baird analyst Michael Bellisario said, adding he had expected Hilton to maintain its 2018 RevPAR growth forecast at 1 percent to 3 percent.
Hilton said overall occupancy rose 1.8 percent in latest quarter, while the average daily room rate rose 1.2 percent.
That helped total revenue surge 24 percent to $2.28 billion, beating analysts estimates of $2.24 billion, according to Thomson Reuters I/B/E/S.
Hilton’s attributable net income was $840 million, including a $665 million benefit related to changes in the U.S tax law. It posted a loss of $387 million a year earlier, which included $513 million in restructuring charges.
Excluding such one-time items, Hilton earned 54 cents in the latest quarter, easily beating analysts estimates of 45 cents, according to Thomson Reuters I/B/E/S.
The company forecast adjusted earnings of $2.49 and $2.60 per share for 2018, while analysts were expecting $2.56 per share.
Reporting by Sanjana Shivdas and Arunima Banerjee in Bengaluru; Editing by Savio D'Souza