Starwood Reports Fourth Quarter And Full Year 2001 Results

Starwood Hotels & Resorts Worldwide, Inc. (NYSE: HOT; ``Starwood`` or the ``Company``) today reported results for the fourth quarter and full year 2001.

As expected, the terrorist attacks on September 11, 2001 continued to have a significant impact on the Company`s results as lodging demand declined to unprecedented levels across the United States and internationally.

Highlights:
* Fourth quarter REVPAR for Same-Store Owned Hotels decreased 23.8% in North America and 26.2% internationally when compared to 2000. Full year REVPAR for Same-Store Owned Hotels decreased 11.9% in North America and 9.6% internationally when compared to 2000.

* Fourth quarter loss per share was $0.01 compared to EPS of $0.64 in 2000, excluding net charges of $80 million (pretax) for special items in 2001 (previous guidance for the charge was for between $75 million and $150 million) and a net credit of $1 million (pretax) in 2000. Including these special items, loss per share in the fourth quarter of 2001 was $0.28 compared to EPS of $0.64 in 2000.

* Full year EPS was $1.00 compared to $1.95 in 2000, excluding net charges for special items of $83 million (pretax) in 2001 and a net credit of $2 million (pretax) in 2000. Including these special items, EPS was $0.73 in 2001 compared to $1.96 in 2000.

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* Total Company EBITDA for the fourth quarter was $206 million compared to $432 million in 2000. For the full year, total Company EBITDA was $1.230 billion compared to $1.573 billion in 2000.

* Total Company EBITDA margin for the fourth quarter was approximately 23.5%. For the full year, total Company EBITDA margin was approximately 31.0%.

Fourth Quarter Ended December 31, 2001:


Excluding net charges for special items of $80 million in 2001 and a net credit of $1 million in 2000, loss per share was $0.01 in the fourth quarter of 2001 compared to EPS of $0.64 in the corresponding period of 2000, reflecting the dramatic reduction in travel following the events of September 11. Historically, the fourth quarter is the strongest quarter of the year. Including these special items, loss per share in the fourth quarter of 2001 was $0.28 compared to EPS of $0.64 in 2000. Total revenues were down 20.5% to $878 million compared to the same period of 2000, resulting from the softening United States economy and the unprecedented decline in industry-wide demand following the September 11 attacks. Operating income, excluding special items, was $56 million in the fourth quarter of 2001 compared to $290 million in the same period of 2000 and the loss from continuing operations, excluding special items, was $2 million in the fourth quarter of 2001 compared to income of $130 million in the same period of 2000 due to the significant decline in hotel operating results and increased depreciation expense resulting from the continued renovation program and the repositioning of certain hotels, offset in part by cost constraint measures, and reduced interest expense resulting from a reduction in interest rates and the completion of financing transactions in the past year (see Financing section of this release).


While most North America properties reported REVPAR declines, assets in Houston, Indianapolis, New Orleans and Montreal were negatively impacted to a lesser degree. New York, the Company`s largest EBITDA contributing city, saw steady month to month recovery as the quarter progressed.


Year Ended December 31, 2001:


For the year ended December 31, 2001, total revenues were $3.967 billion compared to $4.345 billion in the same period of 2000. Excluding net charges for special items of $83 million in 2001 and a net credit of $2 million in 2000, EPS was $1.00 for the year ended December 31, 2001 compared to EPS of $1.95 in the corresponding period of 2000. Including these special items, EPS was $0.73 in 2001 compared to $1.96 in 2000. Income from continuing operations, excluding special items, was $205 million in the year ended December 31, 2001 compared to $400 million in the same period of 2000.


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