October 26, 2016 / 10:40 AM / 3 years ago

CORRECTED-UPDATE 2-Hilton forecasts slower growth for a key revenue measure

(Corrects paragraph 8 to clarify that earnings per share forecast is for the current quarter, not 2017)

* Co cuts 2016 RevPAR growth forecast to 1.5-2 pct from 2-4 pct

* 2017 RevPAR to grow 1-3 pct

* On track to complete spinoffs

By Arunima Banerjee

Oct 26 (Reuters) - Hilton Worldwide Holdings Inc cut its full-year forecast for a key revenue metric for the third time, underscoring weak corporate travel demand in the United States and economic and political uncertainties in Europe.

The Waldorf Astoria hotel chain owner said it now expects its system-wide comparable revenue per available room (RevPAR) to rise between 1.5-2 percent in 2016, down from its previous forecast of 2-4 percent.

The forecast cut was mainly due to “continued softness in corporate transient demand,” Deutsche Bank analysts wrote in a note on Wednesday.

Corporate transient demand reflects individuals traveling for business purposes.

Further growth in RevPAR would require pickup in corporate transient demand, Hilton noted in July. The company added that Brexit and other events in Europe are likely to weigh on demand in the region.

RevPAR is calculated by multiplying a hotel’s average daily room rate by its occupancy rate.

Hoteliers also face rising competition from online holiday rental startups such as Airbnb, just as attacks in Europe have hurt travel demand.

Hilton said it expects RevPAR in 2017 to rise 1-3 percent. For the current quarter, the company forecast adjusted earnings of 20-23 cents per share.

RevPAR in Europe slipped 0.7 percent in the third quarter ended Sept. 30.

The company, which also owns the Conrad and Double Tree hotel chains, said its system-wide RevPAR rose 1.3 percent while occupancy fell marginally and its average daily rate rose 1.5 percent during the quarter.

Hilton said it was on track to complete the spinoffs of Park Hotels & Resorts and Hilton Grand Vacations around the end of the year.

China’s aviation and shipping giant HNA Group said on Monday it would buy a 25 percent stake in Hilton from its biggest shareholder Blackstone Group LP for $6.5 billion.

Net income attributable to Hilton’s stockholders fell to $187 million, or 19 cents per share, in the quarter, from $279 million, or 28 cents per share, a year earlier.

Excluding items, the company earned 23 cents per share, inline with the average analyst estimate, according to Thomson Reuters I/B/E/S.

Revenue rose to $2.94 billion from $2.90 billion, missing analysts’ average estimate of $3.00 billion.

Up to Tuesday’s close, shares of the McLean, Virginia-based company had risen 6.2 percent this year. (Reporting by Arunima Banerjee in Bengaluru; Editing by Martina D’Couto)

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