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ITT posts operating profit
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February 11, 1998: 9:34 p.m. ET
Hotel and gaming concern hopes to complete Starwood deal next week
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NEW YORK (CNNfn) -Hotel and gaming giant ITT Corp. Wednesday reported a 30 percent rise in fourth-quarter operating profits, reflecting improvements in all three of its major business units.
ITT, which recently agreed to be acquired by Starwood Lodging Trust in a $10.2 billion deal, said fourth-quarter operating income rose to $89 million, or 74 cents a share, from $68 million, or 59 cents a share, a year ago. The results edged out the First Call consensus estimate of 73 cents a share.
ITT did not disclose net income figures for the period, but the company said previously announced restructuring charges would translate into a loss for the quarter.
In January, ITT estimated the charges would total about $810 million.
ITT said revenues, excluding assets held for sale, rose 3 percent in the quarter to $1.82 billion.
The company said all three of its major businesses -- hotels, gaming and information services - reported improved cash flow during the quarter.
"The solid results in the fourth quarter are indicative of the underlying strength of our businesses," Rand Araskog, ITT chairman and chief executive, said in a statement. "We expect our merger with Starwood Hotels and Resorts to be completed next week and we are pleased that Starwood will inherit superb human resources, as well as a healthy company poised for continued growth."
ITT was the target of a bitter takeover battle last year between Starwood Lodging (HOT) and Hilton Hotels Corp. (HLT)
Hilton launched its hostile takeover of ITT more than a year ago, igniting a nasty feud as ITT tried to fend off Hilton with asset sales, restructurings and finally a white-knight offer from Starwood Lodging, a real estate investment trust that owns the Westin hotel chain.
In November, the battle finally came down to a shareholder vote, and after an intense lobbying effort, investors chose to keep ITT's board of directors. The vote was a blow to Hilton, which withdrew its hostile offer for ITT.
A spokesman for ITT said the company's shareholders will vote on the deal on Thursday and Starwood shareholders are scheduled to vote on Feb. 18. Both are expected to approve the deal.
"We expect it will be a slam dunk," said ITT spokesman Jim Gallagher.
Assuming the deal is approved, the companies expect to complete the merger on Feb. 20.
For the full year, ITT reported operating earnings of $291 million, or $2.45 per share, up 7 percent from the $249 million, or $2.11 per share reported in 1996. 
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