UPDATE 1-Starwood cuts annual dividend 78 percent

* Cuts 2009 dividend 78 percent

* 20 cents per share vs. 90 cents in 2008

NEW YORK Nov 2 (Reuters) - Starwood Hotels & Resorts Worldwide Inc (HOT.N) said on Monday it cut its annual cash dividend 78 percent to 20 cents per share.

The hotel operator will pay the dividend on Jan. 14, to shareholders of record as of the end of the year.

Previously, Starwood's dividend was 90 cents per share.

Starwood could not be immediately reached for comment. The company's shares were off 44 cents or 1.5 percent to $28.62 in early trading on the New York Stock Exchange.

In its third-quarter earnings report last month, Starwood indicated that it saw a slower recovery for the hotel industry. It projected that revenue per available room in 2010 would be flat to down 5 percent compared with 2009.

This metric, known as RevPAR, is a key indication of fiscal health in the hotel industry. (Reporting by Deepa Seetharaman, editing by Gerald E. McCormick)