Hotel operator Marriott International says its first-quarter net income rose 22 percent as the industry continues to bounce back from the recession.
But its profit and revenue missed analysts' expectations as high unemployment, the dismal housing market and, now, high fuel prices continued to weigh on consumers in North America.
Marriott shares edged down 28 cents to $35 in aftermarket trading Wednesday.
The company, which operates Marriott, Ritz-Carlton and other lodging brands, said its net income was $101 million, or 26 cents per share, for the period that ended March 25. Analysts expected 27 cents per share, according to FactSet.
Revenue rose 6 percent to $2.78 billion. Analysts expected $2.85 billion.
Lodging companies struggled during the recession as both business and leisure travelers stayed home to save money. But demand has picked up over the past several quarters. Discounts prevalent during the recession have all but vanished.
The average daily rate for a room rose 5.9 percent internationally and 2.4 percent in North America for Marriott.
"We're doing well on pricing," Laura Paugh, senior vice president of investor relations, said in a call with reporters Wednesday evening. "We have good demand from business travelers and luxury travelers."
Revenue per available room, a key industry metric, rose 6.5 percent at company-owned locations around the globe, including an 11.2 percent rise internationally and a 5.8 percent increase in North America. But that's shy of the 7 percent growth the company predicted in March.
Paugh said the company missed its projection largely because of weaker demand in Washington, where Marriott opened its first hotel and remains a large presence. Federal budget negotiations, a shorter Congressional quarter and worry there would be a government shut down all dampened bookings compared with a year earlier.
For its second quarter, the Bethesda, Md.-based company forecast net income between 34 cents and 38 cents per share. Analysts expect 39 cents.
Marriott affirmed its expectation for full-year earnings of $1.35 to $1.45 per share. Analysts expect $1.43 per share.
Marriott said its plans to spin off its less-profitable timeshare development and management company later this year were on track.