Financial Report on StarWood Hotels & Resort

Financial Report on StarWood Hotels & Resort

Introduction

Starwood Hotels and Resorts Worldwide, Inc. is an American hotel and leisure companies operating in nearly 100 countries. The main business of the company consists of a worldwide network of hospitality, hotels, vacation ownership resorts and residential complexes serving luxury and upscale market. It consists of two operating segments: hotels and vacation ownership and residential. Hotel segment is a worldwide network of owned, leased and consolidated joint venture hotels and resorts operates mainly under the brand names By including St. Regis ®, The Luxury Collection ®, Sheraton ®, Westin ®, W ® Hotel Le Meridien ®, Four Points ®, Sheraton, Aloft ® and the element ®, as well as hotels and resorts, which are managed or franchised in exchange for a fee. The company recorded revenues of $ 4,712 million during the fiscal year ending December, 2009 (2009), a decrease of 18.1% over 2008. The decline in the industry worldwide housing is a major cause of declining revenues of the company. Operating profit was $ 26 million in fiscal 2009, decreased 95.7% compared with 2008.The net profit was $ 73 million in fiscal 2009, decreased 77.8% compared with 2008(Starwood Hotels & Resorts Worldwide, Inc, 2009).

Ratios

Profitability Ratios

12/31/2012

12/31/2011

ROA % (Net)

9.86

7.09

ROE % (Net)

133.33

297.9

ROI % (Operating)

37.41

(0.76)

EBITDA Margin %

33.6

6.63

Calculated Tax Rate %

25.87

EBT<0

Liquidity Ratios

12/31/2012

12/31/2011

Quick Ratio

0.42

0.32

Current Ratio

0.49

0.4

Net Current Assets % TA

(17.13)

(21.91)

Debt Management

12/31/2012

12/31/2011

LT Debt to Equity

2.86

6.82

Total Debt to Equity

2.93

7.53

Interest Coverage

7.05

-

Asset Management

12/31/2012

12/31/2011

Total Asset Turnover

0.57

0.51

Receivables Turnover

5.26

4.65

Inventory Turnover

188.25

215

Accounts Payable Turnover

15.36

14.65

Accrued Expenses Turnover

4.83

5.18

Property Plant & Equip Turnover

0.92

0.87

Cash & Equivalents Turnover

27.59

25.21

Per Share

12/31/2012

12/31/2011

Cash Flow per Share

1.6

1.52

Book Value per Share

0.94

0.52

Ratio Analysis

Profitability Ratios

The profitability of Starwood Hotels & Resort is satisfactory as the trends of the company from 2011 to 2012 shows that the company has been gaining profits. This statement can be endorsed by the evaluation of the profitability ratios. The return on assets of Starwood Hotels & Resort from 2011 to 2012 is reflecting that profitability structure of the company is raised from 7.09 to 9.86. In addition to this, return on equity shows decline over the 2 years. As the return on equity was 297.9 in 2011 and 133.33 is in 2012.

In addition to this, return on investment and operating profit margin is also showing the increase in the profitability structure of Starwood Hotels & Resort. Furthermore, the operating profit margin shows an increase over the years. The operating profit marginwas 6.63 in 2011, whereas it increases in 2012 to 33.6. This could be as a result of increase in the gross profit margin.. Besides it, the tax rate is reached to 25.87 from 0 which seem to be a positive sign for the Starwood Hotels & Resort, and the over all performance of the company is satisfactory.

Liquidity Ratios

The liquidity ratios that include current ratio, quick ratio and net current assets as a percentage of total assets are increased from 2011 to 2012. This shows that the liquidity position of the Starwood Hotels & Resort is satisfactory. The current ratio increased from 0.4 to ...