Marriott International reports third quarter 2018 results
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Marriott International reports third quarter 2018 results
HIGHLIGHTS |
Category: Worldwide - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2018-11-06
- Third quarter reported diluted EPS totaled $1.38, a 7 percent increase from prior year results. Third quarter adjusted diluted EPS totaled $1.70, a 62 percent increase over third quarter 2017 adjusted results. Adjusted results exclude merger-relatedadjustments, cost reimbursement revenue, and reimbursed expenses;
- During the 2018 third quarter, EPS included $0.26 from gains on asset sales ($71 million pretax reflected in Gains and other income, net and Equity in earnings);
- Third quarter 2018 comparable systemwide constant dollar RevPAR rose 1.9 percent worldwide, 5.4 percent outside North America and 0.6 percent in North America;
- The company added more than 18,000 rooms during the third quarter, including over 1,500 rooms converted from competitor brands and approximately 10,000 rooms in international markets;
- At quarter-end, Marriott’s worldwide development pipeline increased to roughly 471,000 rooms, including nearly 50,000 rooms approved, but not yet subject to signed contracts;
- Third quarter reported net income totaled $483 million, flat compared to prior year results. Third quarter adjusted net income totaled $598 million, a 51 percent increase over prior year adjusted results;
- Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $900 million in the quarter, a 12 percent increase over third quarter 2017 adjusted EBITDA. Third quarter 2018 gross fee revenues totaled $932 million, a 13 percent increase from prior year gross fee revenues;
- Marriott repurchased 6.7 million shares of the company’s common stock for $841 million during the third quarter. Year-to-date through November 5, the company has repurchased 20.8 million shares for $2.7 billion.
Marriott International, Inc. (NASDAQ: MAR) today reported third quarter 2018 results.Arne M. Sorenson, president and chief executive officer of Marriott International, said, “It’s been just over two years since the completion of the Starwood acquisition. We are in the home stretch on integrating the companies and are pleased with the results. On August 18, we integrated our loyalty programs creating one powerful, unified program, allowing our 120 million members to earn, book, and redeem across more than 6,700 hotels. At the time of the acquisition, we stated our goal to recycle assets totaling more than $1.5 billion by the end of 2018. We have already exceeded that goal, recycling more than $1.8 billion since the deal closed.
“In the third quarter, we were pleased to post gross fee revenues growth of 13 percent and adjusted EBITDA growth of 12 percent, as worldwide comparable systemwide hotel RevPAR increased roughly 2 percent. Our results in the third quarter highlight the resiliency of our asset light model and our ability to generate cash. Year-to-date through November 5, we have already returned more than $3.1 billion to shareholders through dividends and share repurchases and now believe we could return roughly $3.7 billion in 2018.
“It has been gratifying to see broad associate participation in Marriott’s retirement savings plans. Approximately 80 percent of eligible associates participated in and will receive a supplemental, one-time company match of up to $1,000. Our associates are our most important assets, serving our guests every day. We recognize their extraordinary efforts and, with this incentive, encourage them to save for the future.
“We expect Marriott’s fourth quarter 2018 comparable systemwide RevPAR on a constant dollar basis will increase roughly 2 percent worldwide, roughly 1 percent in North America, and 5 to 6 percent outside North America. Our forecast for RevPAR in North America reflects an estimated 110-basis-point headwind due to the 2017 hurricane relief efforts in Texas and Florida and it also reflects the slightly weaker than expected transient demand the industry experienced during September. Trends in most international markets are expected to remain strong.
“For full year 2019, based on our early budgeting analysis, we expect comparable systemwide RevPAR on a constant dollar basis will increase 2 to 3 percent worldwide, 1 to 3 percent in North America, and 3 to 5 percent outside North America.
“For the full year 2018, we anticipate our number of rooms will increase nearly 7 percent gross while room deletions should total nearly 2 percent, resulting in net rooms growth of roughly 5 percent for the year. For the full year 2019, we anticipate gross room additions will increase at a rate similar to 2018, but deletions should moderate to 1 to 1.5 percent for the year, resulting in net rooms growth acceleration to roughly 5.5 percent.”
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