LOS ANGELES (AP) -- Hilton Hotels Corp. (HLT) reported Tuesday that first-quarter profit climbed 63 percent, driven by strengthening demand from business travelers and various one-time items.
Beverly Hills-based Hilton reported net income of $104 million, or 26 cents per share, for the three months ended March 31, versus a prior-year profit of $64 million, or 16 cents per share. Nonrecurring items like a contract termination fee, foreign exchange gains and other items bolstered the most recent quarter's results by 6 cents per share.
Revenue rose 41 percent to $1.52 billion from $1.08 billion in the year earlier period.
The results beat the expectations of analysts surveyed by Thomson Financial, who had expected earnings of 18 cents a share for the quarter, including the impact of expensing stock options.
Revenue per available room, a key performance indicator, increased 9 percent, driven by rate increases and high demand in most major markets, the company said. Increased demand from both business and leisure travelers resulted in high single-digit or double-digit average daily rate increases at many of its major U.S. hotels.
The company's profit margins fell in the quarter as Hilton embarked on an aggressive refurbishing of some of its high-profile properties, including the New York Hilton and a resort in Hawaii. Margins were also affected by a new marketing campaign and higher energy costs, the company said.
Although those efforts will also reduce margins in the second quarter, the company said it will reap long-term benefits.
"It's the absolute right thing for us to do for the Hilton brand," Matthew J. Hart president and chief operating officer said in a conference call with analysts.
Hart also warned that the company faces negotiations with several labor unions later this year, which could affect earnings depending on the outcome.
The earnings report was the first since the company completed its acquisition of the hotel assets of Britain's Hilton Group PLC for $5.8 billion in February.
For 2006, Hilton projected earnings per share of $1.12 to $1.19 per share, which includes results from its international properties.
NEW YORK (Reuters) - Verizon Communications Inc. (VZ), one of the world's biggest telephone companies, said Tuesday its quarterly earnings fell on merger costs but revenue rose due to strength in wireless.
Verizon, which also owns Verizon Wireless with Vodafone Group Plc, said net earnings fell to $1.63 billion, or 56 cents a share from $1.76 billion, or 63 cents a share in the year-ago quarter, which excludes MCI's numbers.
Excluding unusual items Verizon said it earned 60 cents a share, compared with analyst estimates for 59 cents a share, according to Reuters Estimates.
Revenue rose to $22.74 billion from $18.18 billion in the year-ago quarter before it owned MCI.
Assuming the company owned MCI in both quarters Verizon said its adjusted earnings per share fell 3.3 percent and that adjusted operating revenue increased 3.1 percent.
Verizon said Verizon Wireless added 1.7 million net new customers in the quarter compared with average estimates for 1.6 million customers from six analysts contacted by Reuters.
AT&T Inc (T), another large U.S. regional phone company, last week reported first-quarter earnings that beat Wall Street estimates and BellSouth Corp. (BLS) posted a revenue increase of 4.5 percent the week before that.
NEW YORK (Reuters) - Sirius Satellite Radio Inc. (SIRI) Tuesday posted a sharp rise in first-quarter revenue and subscribers to its pay-radio service, overshadowing a significantly wider loss from the cost of gaining new users.
Shares of the New York-based company, No. 2 in the nascent pay-radio market to XM Satellite Radio Inc. (XMSR), rose 7 percent in premarket dealings as the company raised its forecast for subscribers at the end of 2006 to over 6.2 million, from its previous goal of 6 million.
Sirius said its net loss widened to $458.5 million, or 33 cents a share, from a loss of $193.6 million, or 15 cents a share, a year earlier.
Revenue at Sirius, which in January launched a show with ribald shock jock Howard Stern, nearly tripled to $126.7 million, from $43.2 million.
Analysts on average had expected a loss of 37 cents a share, on revenue of $126.7 million, according to Reuters Estimates.
Sirius added 761,187 subscribers in the first quarter to end with 4.08 million, up 2.6 million from one year before.
Subscriber acquisition costs per gross addition were $113 for the first quarter.
Sirius said it expects to see 2006 revenue in excess of $600 million, revenue in 2007 of about $1 billion, and 2010 revenue of around $3 billion.
CHICAGO (Reuters) - Archer Daniels Midland Co. (ADM), the largest U.S. food processor, on Tuesday reported better-than-expected quarterly profit, sending its shares up in premarket trading.
Earnings rose 29 percent due to improved margins in oilseed processing and better prices for high-fructose corn syrup.
ADM said earnings rose to $348 million, or 53 cents per share, for the fiscal third quarter ended March 31, compared with $269 million, or 41 cents per share, a year earlier.
Analysts on average were expecting 46 cents per share, according to Reuters Estimates.
Year-earlier earnings included a gain of $74 million, or 11 cents per share, related to ADM selling its interest in Tate & Lyle Plc , a maker of sweeteners.
Revenue rose 8 percent to $9.12 billion, compared with $8.48 billion a year ago.
Much of ADM's recent growth has been powered by increased demand for crop-based fuels, such as ethanol and biodiesel.
For the quarter, ADM said ethanol sales volume dropped compared with year-earlier levels. Last year's ethanol sales volume included a draw-down of ethanol stocks, which were built up in anticipation of new markets.
In January, ADM raised prices for high-fructose corn syrup, which was expected to benefit earnings in the second half of the fiscal year. ADM is the world's largest manufacturer of the sweetener, which is used in soda and candy.
Shares of ADM, based in Decatur, Illinois, were up $1.01, or 2.7 percent, at $39.01 in premarket trade on the Inet electronic brokerage system.
ADM shares have risen 51 percent this year, compared with an 8.6 percent rise in the Dow Jones U.S. Food Producers Index , based on Monday's closing prices.