Though net income fell 53% because of year-earlier gains on investments, Hyatt Hotels Corp.'s third-quarter earnings beat analyst estimates, which the company attributed to a rise in demand for its select-service hotels in North America.
Net income for the quarter was $14 million, down from $30 million a year earlier, Hyatt said, while revenue increased 2%, to $897 million.
Hyatt benefited from strong demand for its select-service brands such as Hyatt Place and Hyatt Summerfield Suites. North American select-service revenue per available room rose 8.8% from a year earlier on a 4.1 percentage-point occupancy increase and a 3.1% increase in average room rates.
Hyatt's emphasis on select-service operations was illustrated by its $660 million acquisition of the 19-hotel LodgeWorks portfolio in August. And in September, Hyatt said it would rebrand its Summerfield Suites properties and the Hotel Sierra properties from the LodgeWorks acquisition under a new extended-stay brand called Hyatt House. The rebranding effort will take place over the next year.
The LodgeWorks acquisition "immediately expands our extended-stay presence, expertise and development capabilities in North America as well as adds several unique, full-service hotels to Hyatt's portfolio," Hyatt CEO Mark Hoplamazian said in a statement. "While it is still early, we are pleased with the initial results."
Hyatt's global RevPAR rose 6.9% excluding currency effects. Worldwide select-service hotel RevPAR rose 10.5% from a year earlier while full-service hotel RevPAR was up 6.3%.
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