Hotel franchise companies Wyndham and Choice posted increases in their second-quarter profits, and both said they expected their performance to continue improving throughout the year.
Wyndham Worldwide said Q2 net earnings jumped 34%, primarily on improvements in its vacation rental business.
Choice Hotels, which franchises a number of economy and midscale brands, reported Q2 net earnings were up 8% on increases in occupancy.
Wyndham said its net income was $95 million, compared with $71 million a year earlier. Second-quarter revenue was $963 million, up 5% from last year.
"Continued strong operating performance in each of our businesses in the second quarter, combined with a lower overall tax rate, enables us to increase our full-year earnings guidance," said Stephen Holmes, chairman and CEO of Wyndham Worldwide. "We continue to generate significant levels of sustainable, free cash flow that we are deploying to drive shareholder value."
In its lodging business, which includes the Wyndham, Ramada, Howard Johnson and Super 8 brands, Wyndham said revenue was up 2%, to $178 million. However, in constant currency, systemwide revenue per available room decreased 1.2% for the quarter.
Its vacation rental revenue was up 12% in constant dollars, to $115 million, while exchange business revenue was down 3%.
Choice Hotels earned $27 million on $150 million in revenue, compared with $25 million on $143 million in revenue in the same quarter last year.
Revenue per available room was up 0.3%, while average daily rate was down 2.2%, to $69.01. Occupancy was 51.7%, compared with 50.4% in the same period last year.
"We're pleased to report positive domestic RevPAR for the first time since the second quarter of 2008, due in large part to gains in occupancy and a gradually improving average daily rate environment from this year's first quarter," said Stephen Joyce, president and CEO. "We expect RevPAR to continue to show improvement for the remainder of the year. However, we believe the hotel transaction environment will remain difficult and thus continue to adversely impact our franchise sales results."
Choice Hotels International's brands are Comfort Inn, Comfort Suites, Quality, Sleep Inn, Clarion, Cambria Suites, MainStay Suites, Suburban Extended Stay Hotels, Econo Lodge, Rodeway Inn and the Ascend Collection.
This report appeared in the Aug. 2 issue of Travel Weekly.