Weakness in
Waikiki hits Hilton
The hotel company's earnings
From staff and wire reports
fell 16 percent in the
third quarterBEVERLY HILLS, Calif. -- Hilton Hotels Corp., the third-largest U.S. hotel company, said third-quarter profit fell 16 percent as recessions in Asia hurt two of its top hotels and it won less than usual at the gambling tables of one of its top casinos.
Net income fell to $79 million, or 30 cents a share, from $94 million, or 35 cents, a year earlier. The profit was in line with reduced forecasts of 31 cents from analysts polled by First Call Corp. Revenue rose 1.4 percent to $1.33 billion from $1.31 billion.
Hilton warned Sept. 14 that it would make less money than expected in the quarter, as fewer Asians visited the San Francisco Hilton and the 2,542-room Hilton Hawaiian Village in Waikiki. At the time, it was expected to earn about 38 cents a share.
Waikiki, a popular destination for Japanese travelers, has been particularly hard hit by this year's decline in travel from Japan. Hilton operates one other hotel on Oahu, the Hilton Turtle Bay Resort. It also operates the 1,241-room Hilton Waikoloa Village on the Big Island.
The company's results are "reflecting slowing (revenue) and a slowing economy," said Bear, Stearns & Co. analyst Jason Ader, who rates Hilton shares "attractive." Hilton shares rose 6 cents to $18.94 in trading on the New York Stock Exchange. The stock has fallen about 42 percent in the past year.
Cash flow decreased at Hilton's important Bally's Park Place casino in Atlantic City, N.J., because of smaller winnings at its table games. Hilton is the world's largest casino company.
Higher debt after $860 million in acquisitions this year also hurt profit, Hilton said.
The company said it's on track to complete its split into separate hotel and casino companies and its $1.2 billion purchase of Grand Casino Inc.'s three Mississippi resorts by the end of 1998.
Bloomberg News contributed to this report.
