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02/18/2015

Marriott International Reports Fourth Quarter and Full Year 2014 Results

HIGHLIGHTS 

  • Fourth quarter diluted EPS totaled $0.68, a 39 percent increase over prior year results;
     
  • North American comparable systemwide RevPAR rose 6.7 percent in the fourth quarter and 7.0 percent for the full year;
     
  • On a constant dollar basis, worldwide comparable systemwide RevPAR rose 6.2 percent in the fourth quarter and 6.6 percent for the full year;
     
  • For full year 2014, Marriott repurchased 24.2 million shares of the company’s common stock for $1.5 billion including 7.7 million shares for $544 million in the fourth quarter;
     
  • Comparable company-operated house profit margins increased 150 basis points in North America and 120 basis points worldwide for the full year;
     
  • At year-end, the company’s worldwide development pipeline increased to nearly 240,000 rooms, including approximately 30,000 rooms approved, but not yet subject to signed contracts;
     
  • Over 46,000 rooms were added in 2014 including nearly 9,000 rooms converted from competitor brands and over 10,000 rooms associated with the Protea transaction;
     
  • The company signed a record 100,000 rooms in 2014;
     
  • Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $384 million in the quarter, a 20 percent increase over fourth quarter 2013 adjusted EBITDA;
     
  • Adjusted for cost reimbursements, the company’s full year 2014 operating income margin increased to 42 percent.  Return on invested capital totaled 36 percent in 2014;
     
  • For full year 2015, Marriott expects North American and worldwide comparable systemwide constant dollar RevPAR to increase 5 to 7 percent. 

BETHESDA, MD – February 18, 2015 - Marriott International, Inc. (NASDAQ: MAR) today reported fourth quarter and full year 2014 results.

Fourth quarter 2014 net income totaled $197 million, a 30 percent increase over 2013 net income.  Fourth quarter 2014 diluted earnings per share (EPS) totaled $0.68, a 39 percent increase from 2013 diluted EPS.  On October 28, 2014, the company forecasted fourth quarter diluted EPS of $0.62 to $0.66.

Arne M. Sorenson, president and chief executive officer of Marriott International, said, “Today, we post both record earnings and unit growth and conclude 2014 with the strongest worldwide development pipeline of rooms in our history.  Our powerful portfolio of brands has never been better positioned or more in demand by our owners, franchisees and guests.  In 2014, we signed agreements for a record-breaking 100,000 rooms, boosting our development pipeline to nearly 240,000 rooms. At year-end, our system reached nearly 715,000 rooms in 79 countries and territories.  With the strength of our portfolio, we expect to reach one million rooms open or under development well before the end of 2015, offering a growing number of travel opportunities for our 49 million loyal Rewards members.

“In the fourth quarter, our worldwide systemwide RevPAR increased more than 6 percent.  In North America, business and leisure transient demand were strong, which drove limited-service systemwide RevPAR up 8 percent.  We expect transient demand to remain strong.  In fact, based on signings to date, we expect special corporate room rates across all our managed North American hotels will increase 5 to 6 percent in 2015.

“During the year, our calendar of group meeting business in North America favored the first three quarters of 2014, largely due to the timing of holidays.  As expected, this tempered results at our full-service hotels during the fourth quarter, particularly at our largest convention hotels.  We are seeing group business restrengthen for 2015.  Group revenue bookings for our managed full-service hotels are up almost 5 percent for the full year 2015 and 6 percent in the first quarter alone.

“Our international hotels performed well in the fourth quarter.  Strong leisure demand in the Caribbean and Mexico, good weather in Europe, increased travel to Egypt, and improving trends in India and Japan drove systemwide constant dollar RevPAR up nearly 5 percent.  However, on an actual dollar basis, our international systemwide RevPAR increased only 0.5 percent.  After hedges, the change in exchange rates reduced our income before taxes by $5 million in the fourth quarter and $23 million for the full year.  The full year impact included $11 million related to the Venezuela devaluation earlier in 2014.

“We remain committed to driving growth, delivering results and returning excess cash to shareholders.  In 2014, worldwide systemwide RevPAR increased just under 7 percent and we expanded our system size by 6 percent, net, including the rooms from the Protea transaction.  Earnings per share increased by 27 percent and adjusted EBITDA rose 15 percent.  In 2015, we expect worldwide systemwide constant dollar RevPAR will increase 5 to 7 percent, and we expect the number of rooms in our existing brands will increase by about 6 percent, net.  In addition, we expect to add an additional 10,000 rooms with the closing of the anticipated Delta transaction.  Excluding the impact of Delta, diluted EPS could total $3.00 to $3.12 in 2015, an 18 to 23 percent increase over 2014 and adjusted EBITDA could increase 13 to 16 percent.  We returned nearly $1.75 billion to shareholders through share repurchase and dividends in 2014 and we expect to return at least as much in 2015.  We are looking forward to another great year.”

For the 2014 fourth quarter, RevPAR for worldwide comparable systemwide properties increased 6.2 percent (a 5.3 percent increase using actual dollars).  For the full year, RevPAR for worldwide comparable systemwide properties increased 6.6 percent (a 6.3 percent increase using actual dollars).

In North America, comparable systemwide RevPAR increased 6.7 percent in the fourth quarter of 2014, including a 4.2 percent increase in average daily rate.  RevPAR for comparable systemwide North American full-service hotels (including Marriott Hotels, The Ritz-Carlton, Renaissance Hotels, Gaylord Hotels and Autograph Collection Hotels) increased 5.2 percent with a 4.4 percent increase in average daily rate.  RevPAR for comparable systemwide North American limited-service hotels (including Courtyard, Residence Inn, SpringHill Suites, TownePlace Suites and Fairfield Inn & Suites) increased 8.2 percent in the fourth quarter with a 4.6 percent increase in average daily rate.

International comparable systemwide RevPAR rose 4.6 percent (a 0.5 percent increase using actual dollars) in the fourth quarter.  For the full year, international comparable systemwide RevPAR rose 5.1 percent (a 4.0 percent increase using actual dollars).

Marriott added 70 new properties (14,605 rooms) to its worldwide lodging portfolio in the 2014 fourth quarter, including the Atlantis Paradise Island, an Autograph Collection hotel, the Miami Beach EDITION and the Ritz-Carlton, Bali.  Twenty-two properties (1,851 rooms) exited the system during the quarter.  At year-end, the company’s lodging system encompassed 4,175 properties and timeshare resorts for a total of nearly 715,000 rooms.

The company’s worldwide development pipeline increased to nearly 1,450 properties with nearly 240,000 rooms at year-end, including 180 properties with approximately 30,000 rooms approved for development, but not yet subject to signed contracts.  The company’s pipeline at year-end 2014 does not include the approximately 10,000 rooms associated with the expected Delta transaction announced on January 27, 2015.

MARRIOTT REVENUES totaled nearly $3.6 billion in the 2014 fourth quarter compared to revenues of $3.2 billion for the fourth quarter of 2013.  Base management and franchise fees totaled $348 million compared to $315 million in the year-ago quarter, an increase of 10 percent.  The increase largely reflected higher RevPAR and new unit growth, partially offset by $2 million of unfavorable foreign exchange. 

Fourth quarter worldwide incentive management fees increased 12 percent to $82 million primarily due to higher RevPAR and house profit margins, partially offset by $3 million of unfavorable foreign exchange and $5 million of lower deferred fee recognition.   In the fourth quarter, 40 percent of worldwide company-managed hotels earned incentive management fees compared to 32 percent in the year-ago quarter.  For full year 2014, 50 percent of worldwide company-managed hotels earned incentive management fees compared to 38 percent in 2013.

Worldwide comparable company-operated house profit margins increased 90 basis points in the fourth quarter with higher room rates, improved productivity and solid cost controls.  House profit margins for comparable company-operated properties outside North America increased 70 basis points and North American comparable company-operated house profit margins increased 110 basis points from the year-ago quarter.

Owned, leased, and other revenue, net of direct expenses, totaled $73 million, compared to $63 million in the year-ago quarter.  The year-over-year improvement reflected higher residential and credit card branding fees, an increase in termination fees and the favorable impact of the Protea leased hotel portfolio acquired at the beginning of the second quarter, partially offset by $2 million of higher pre-opening expenses and $1 million of unfavorable foreign exchange. 

On October 28, 2014, the company estimated owned, leased, and other revenue, net of direct expenses for the fourth quarter would total approximately $65 million.  Actual results in the quarter were above the estimate largely due to $4 million of stronger results at owned and leased hotels and $4 million of higher than expected termination fees.

GENERAL, ADMINISTRATIVE, and OTHER expenses for the 2014 fourth quarter totaled $180 million compared to $178 million in the year-ago quarter.  Expenses in the quarter included $4 million of guarantee reserves relating to two hotels.   For full year 2014, general, administrative, and other expenses increased 2 percent to $659 million.

GAINS AND OTHER INCOME totaled $4 million in the fourth quarter.  Gains and other income in the fourth quarter of 2014 included a $5 million distribution related to the sale of a hotel in an investment fund. 

INTEREST EXPENSE, NET declined $9 million in the fourth quarter.  Interest expense for the fourth quarter decreased $6 million largely due to a $7 million one-time favorable interest expense true-up, partially offset by higher senior debt borrowings.  Interest income increased $3 million year-over-year as a result of an increase in loans receivable.

On October 28, 2014, the company estimated interest expense, net for the fourth quarter would total approximately $20 million.  Actual interest expense, net in the quarter was lower than the estimate largely due to the one-time favorable interest expense true-up.

EQUITY IN EARNINGS increased $3 million in the fourth quarter.  The increase largely reflected better operating results in one joint venture.

Adjusted Earnings before Interest Expense, Taxes, Depreciation and Amortization (EBITDA)
For the fourth quarter, adjusted EBITDA totaled $384 million, a 20 percent increase over fourth quarter 2013 adjusted EBITDA of $321 million.  See page A-8 for the adjusted EBITDA calculation.

Full year 2014 adjusted EBITDA totaled $1,524 million, a 15 percent increase over 2013 adjusted EBITDA of $1,325 million. 

BALANCE SHEET
At year-end, total debt was $3,781 million and cash balances totaled $104 million, compared to $3,199 million in debt and $126 million of cash at year-end 2013.

At the beginning of the 2014 fourth quarter, the company issued $400 million of Series N Senior Notes due in 2021 with a 3.1 percent interest rate coupon. 

COMMON STOCK
Weighted average fully diluted shares outstanding used to calculate diluted EPS totaled 289.0 million in the 2014 fourth quarter, compared to 307.5 million in the year-ago quarter.

The company repurchased 7.7 million shares of common stock in the fourth quarter at a cost of $544 million.  For full year 2014, Marriott repurchased 24.2 million shares of its stock for $1.5 billion at an average price of $62.09.  To date in 2015, the company has repurchased 3.6 million shares for $275 million.  On February 12, 2015, the board of directors increased the company’s share authorization to repurchase shares by 25 million for a total authorization of 36.5 million shares as of February 18, 2015. 

OUTLOOK
For the 2015 first quarter, the company expects comparable systemwide RevPAR on a constant dollar basis will increase 5 to 7 percent in North America, 4 to 6 percent outside North America and 5 to 7 percent worldwide.

For full year 2015, the company expects comparable systemwide RevPAR on a constant dollar basis will increase 5 to 7 percent in North America, 3 to 5 percent outside North America and 5 to 7 percent worldwide.

The company anticipates gross room additions of approximately 7 percent, or 6 percent, net, worldwide for the full year 2015.  This does not include the approximately 10,000 rooms associated with the expected Delta transaction.

The company assumes full year fee revenue could total $1,875 million to $1,915 million, growth of 9 to 11 percent over 2014 fee revenue of $1,719 million. 

For 2015, the company anticipates general, administrative and other expenses will total $635 million to $645 million, a 2 to 4 percent decline compared to 2014 expenses of $659 million.

Given these assumptions, 2015 diluted EPS could total $3.00 to $3.12, an 18 to 23 percent increase year-over-year.  The guidance provided for 2015 does not include the impact of the expected Delta transaction.

 

First Quarter 2015 Full Year 2015
 Total fee revenue         $440 million to $450 million              $1,875 million to $1,915 million
 Owned, leased and other revenue, net of direct expenses  Approx. $60 million      Approx. $250 million
Depreciation, amortization, and other expenses  Approx. $30 million      Approx. $135 million
 General, administrative, and other expenses      $150 million to $155 million  $635 million to $645 million
 Operating income      $315 million to $330 million  $1,345 million to $1,395 million
 Gains and other income      Approx. $0 million  Approx. $0 million
 Net interest expense1  Approx. $30 million  Approx. $135 million
 Equity in earnings (losses)  Approx. $0 million  Approx. $5 million
 Earnings per share      $0.68 to $0.72  $3.00 to $3.12
 Tax rate    32.3 percent

1Net of interest income

The company expects investment spending in 2015 will total approximately $600 million to $800 million, including approximately $125 million for maintenance capital and approximately $135 million for the expected Delta transaction.  Investment spending also includes other capital expenditures (including property acquisitions), new mezzanine financing and mortgage notes, contract acquisition costs, and equity and other investments.  Assuming this level of investment spending, at least $1.75 billion could be returned to shareholders through share repurchases and dividends.

Based upon the assumptions above, the company expects full year 2015 adjusted EBITDA will total $1,715 million to $1,765 million, a 13 to 16 percent increase over the 2014 full year adjusted EBITDA of $1,524 million.  See page A-9 for the adjusted EBITDA calculation.

Marriott International, Inc. (NASDAQ: MAR) will conduct its quarterly earnings review for the investment community and news media on Thursday, February 19, 2015 at 10 a.m. Eastern Time (ET).  The conference call will be webcast simultaneously via Marriott’s investor relations website at http://www.marriott.com/investor, click the “Recent and Upcoming Events” tab and click on the quarterly conference call link.  A replay will be available at that same website until February 19, 2016.

The telephone dial-in number for the conference call is 706-679-3455 and the conference ID is 41025602.  A telephone replay of the conference call will be available from 1 p.m. ET, Thursday, February 19, 2015 until 8 p.m. ET, Thursday, February 26, 2015.  To access the replay, call 404-537-3406.  The conference ID for the recording is 41025602.

Note on forward-looking statements:  This press release and accompanying schedules contain “forward-looking statements” within the meaning of federal securities laws, including RevPAR, profit margin and earnings trends, estimates and assumptions; the number of lodging properties we expect to add to or remove from our system in the future; our expectations about investment spending; and similar statements concerning anticipated future events and expectations that are not historical facts.  We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those we identify below and other risk factors that we identify in our most recent annual or quarterly report on Form 10-K or Form 10-Q.  Risks that could affect forward-looking statements in this press release include changes in market conditions; the continuation and pace of the economic recovery; supply and demand changes for hotel rooms; competitive conditions in the lodging industry; relationships with clients and property owners; and the availability of capital to finance hotel growth and refurbishment.  Any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release.  We make these forward-looking statements as of February 18, 2015.  We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Marriott International, Inc. (NASDAQ: MAR) is a leading lodging global company based in Bethesda, Maryland, USA, with more than 4,100 properties in 79 countries and territories.  Marriott International reported revenues of nearly $14 billion in fiscal year 2014.  The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands, including: Marriott Hotels, The Ritz-Carlton, JW Marriott, Bulgari, EDITION, Renaissance, Gaylord Hotels, Autograph Collection, AC Hotels by Marriott, Moxy Hotels, Courtyard, Fairfield Inn & Suites, SpringHill Suites, Residence Inn, TownePlace Suites, Protea Hotels, Marriott Executive Apartments and Marriott Vacation Club timeshare brand.  Marriott has been consistently recognized as a top employer and for its superior business ethics.  The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 49 million members.  For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

Click here to Download MAR Q4 2014 Press Release Schedules - FINAL

Contacts: 
Tom Marder, (301) 380-2553, thomas.marder@marriott.com 
Betsy Dahm, (301) 380-3372, betsy.dahm@marriott.com

02/12/2015

Marriott International Declares Cash Dividend; Increases Share Buyback Authorization

Bethesda, Md., February 12, 2015 – Marriott International, Inc. (NASDAQ: MAR) today announced that its board of directors declared a quarterly cash dividend of twenty cents ($0.20) per share of common stock.  

The dividend is payable on March 27, 2015 to shareholders of record on February 27, 2015.

Marriott also announced that its board has increased the authorization to repurchase the Company’s Class A common stock by an additional 25 million shares, for a total of approximately 37 million shares currently authorized for repurchase. Shares may be purchased in the open market or in privately negotiated transactions. The company repurchased 24 million shares for $1.5 billion in 2014.     

Marriott International, Inc. (NASDAQ: MAR) is a leading lodging global company based in Bethesda, Maryland, USA, with more than 4,100 properties in 79 countries and territories.  Marriott International reported revenues of nearly $13 billion in fiscal year 2013. The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands, including: Marriott Hotels, The Ritz-Carlton, JW Marriott, Bulgari, EDITION, Renaissance, Gaylord Hotels, Autograph Collection, AC Hotels by Marriott, Moxy Hotels, Courtyard, Fairfield Inn & Suites, SpringHill Suites, Residence Inn, TownePlace Suites, Protea Hotels, Marriott Executive Apartments and Marriott Vacation Club timeshare brand.  There are approximately 330,000 employees at headquarters, managed and franchised properties.  Marriott has been consistently recognized as a top employer and for its superior business ethics. The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 47 million members.  For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

Connect with Felicia.McLemore@Marriott.com

01/20/2015

Marriott Expects to Reach One Million Rooms Open or in Development in 2015

Miami Beach EDITION HotelNew Hotels Expected to Drive Over $50 Billion in Real Estate Investment and Create More Than 150,000 Anticipated New Hotel Jobs

 DAVOS, SWITZERLAND AND BETHESDA, MD, USA – January 20, 2015 – Continuing its trajectory of rapid global growth and creating opportunity, Marriott International, Inc. (NASDAQ: MAR) said today that it expects its portfolio of hotels either open or under development to surpass 1 million rooms by the end of 2015.  When open, the hotels under development will have generated more than $50 billion in real estate investment globally by Marriott’s owner partners and created over 150,000 anticipated new hotel jobs.

Arne Sorenson, Marriott’s president and chief executive officer, said, “An important focus of the World Economic Forum in Davos is creating new jobs and economic growth. In partnership with our owners in more than 100 countries and territories where we operate or have new hotels in development, Marriott is making a meaningful contribution to economic opportunity.  The growth in Marriott’s portfolio is truly a global trend, with strong expansion in the US and in many markets around the world.

“In 2014 alone, Marriott signed agreements for more than 650 hotels and 100,000 rooms to be added to its worldwide system over the next few years, a signing pace of nearly two new hotel deals a day.  This anticipated investment by our owner partners in Marriott-affiliated hotels will show their confidence in our brands, which reflects the preference our brands have with customers.  Together, our growth fuels economic development in communities around the globe, boosting construction and direct employment at the hotels, as well as incremental commerce that emerges around this growth,” said Sorenson.

A study by the German Agency for International Cooperation (GIZ) researched the economic and community benefit of hotels and found in its initial study of the JW Marriott Lima Hotel in Peru, which employs 350 associates and features 300 guestrooms and 10 meeting rooms, that the hotel contributes more than $10 million annually to the Peruvian economy through expenditures on salaries, supplies and services.

Haiti shovelIn developing regions such as Haiti and Africa, Marriott is working closely with hotel owners and non-governmental organizations to prepare and then hire local residents to manage and operate new hotels.  The new Marriott Port-au-Prince in Haiti will open in February having added more than 200 new local jobs.

“With nearly 1 billion1 people moving upward into the middle class across the globe, the incentives to travel, both for business and to see the world, are powerful and are building in momentum.   The doors to travel are increasingly open, as seen in the recent landmark agreement between China and the United States for mutual 10-year visas.  Since that policy change was announced there has been a nearly 39 percent increase in applications for U.S. visas for Chinese visitors, who spend on average, seven thousand dollars per trip. The potential for new travel and economic growth is huge,” said Sorenson

“Clearly efforts to grow, generate economic opportunity and encourage travel can pay big dividends, not just for companies involved, but for communities around the world,” he said.

Tony Capuano, Marriott’s executive vice president and chief development officer, said that the company’s dramatic growth profile has been building steadily. 

“We achieved record growth across the board in 2014, as we opened more than 46,000 rooms worldwide.  Having signed agreements in 2014 for over 650 new hotels and 100,000 rooms, we boosted our record pipeline of new hotel development to nearly 240,000 rooms. When opened over the next few years, these new hotels will expand Marriott’s presence from 80 countries and territories today to more than 100.  This continues an historic four-year surge in demand for new Marriott hotels that drives a bullish growth outlook.

“Our success has been boosted by a number of factors, including our continental leadership structure that connects our local development teams with development partners and lenders, the continuity of our senior development team, and the introduction of new brands which accounted for nearly 40% of our new room openings this past year. We and our hotel owners are excited about our new brands, including Moxy, AC by Marriott, Autograph and EDITION, and our newly acquired Protea brand in Africa."

Marriott’s growth is significant on a regional basis.  In North America, the company is entering new secondary and tertiary markets as well as adding to its strength in the largest cities.   In Asia, the company expects to more than double its distribution as hotel projects in the current pipeline open, more than doubling Marriott’s presence in the Asia-Pacific region. The company also expects its robust growth will continue in the Middle East and Africa, where Marriott’s portfolio could expand by more than 75 percent, and the Caribbean and Latin America, where its system size could increase by nearly 50 percent.  In Europe, the company’s aggressive growth plans will leverage a broad portfolio of brands, including Moxy, a new stylish budget alternative for travelers with a millennial mindset.

Note on forward-looking statements: This press release contains “forward-looking statements” within the meaning of U.S. federal securities laws, including Marriott’s expectations about the number of rooms open or under development in 2015, the amount of future owner investment and the resulting generation of jobs, regional expansion plans, and similar statements concerning anticipated future events and expectations that are not historical facts. We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including supply and demand changes for hotel rooms, competitive conditions in the lodging industry, relationships with clients and property owners, the availability of capital to finance hotel growth, and other risk factors that we identify in Marriott’s most recent quarterly report on Form 10Q.  Any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release. We make these forward-looking statements as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Marriott International, Inc. (NASDAQ: MAR) is a leading lodging global company based in Bethesda, Maryland, USA, with more than 4,100 properties in 79 countries and territories.  Marriott International reported revenues of nearly $13 billion in fiscal year 2013.  The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands, including: Marriott Hotels, The Ritz-Carlton, JW Marriott, Bulgari, EDITION, Renaissance, Gaylord Hotels, Autograph Collection, AC Hotels by Marriott, Moxy Hotels, Courtyard, Fairfield Inn & Suites, SpringHill Suites, Residence Inn, TownePlace Suites, Protea Hotels, Marriott Executive Apartments and Marriott Vacation Club timeshare brand.  Approximately 330,000 people work at Marriott managed and franchised hotels around the globe.  Marriott has been consistently recognized as a top employer and for its superior business ethics. The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 47 million members.  For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com

Contacts
Tom Marder, 001.301.380.2553, thomas.marder@marriott.com 
Felicia McLemore, 001.301.380.2702, felicia.mclemore@marriott.com

01/05/2015

Marriott International Announces Release Date for Fourth Quarter 2014 Earnings

Bethesda, Md., January 5, 2015 – Marriott International, Inc. (NASDAQ: MAR) will report fourth quarter 2014 earnings results on Wednesday, February 18, 2015, at approximately 5:00 pm Eastern Time (ET).  The company will hold a conference call for the investment community to discuss its fourth quarter 2014 earnings on Thursday, February 19, 2015 at 10 a.m. ET.  Mr. Arne Sorenson, Marriott International's president and chief executive officer, and Mr. Carl Berquist, Marriott International's executive vice president and chief financial officer, will discuss the company's performance.

The conference call will be webcast simultaneously via Marriott’s investor relations website.  Those wishing to access the call on the web should log on to http://www.marriott.com/investor, and click the link for the fourth quarter earnings call under “Recent and Upcoming Events”.  A replay will be available at that same website until February 19, 2016.  A transcript of the call will also be available on the company’s website.

The telephone dial-in number for the conference call is 706-679-3455.  Please use conference ID 41025602  when dialing into the call.  To help ensure you do not miss any of the conference call, please dial-in or link to the call on the web 10 minutes prior to the scheduled start time.  News media will be able to access the conference call in a listen-only mode. 

A telephone replay of the conference call will be available from 1 p.m. ET, Thursday, February 19, 2015 until 8 p.m. ET, Thursday, February 26, 2015.  To access the replay, call 404-537-3406.  The conference ID for the recording is 41025602. 

Visit Marriott International, Inc. (NASDAQ: MAR) for company information. For more information or reservations, please visit our web site at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

Connect with thomas.marder@marriott.com; or betsy.dahm@marriott.com

11/06/2014

Marriott International Declares Cash Dividend

Bethesda, Md. – November 6, 2014 – Marriott International, Inc. (NASDAQ: MAR) today announced that its board of directors declared a quarterly cash dividend of twenty cents ($0.20) per share of common stock.   

The dividend is payable on December 26, 2014 to shareholders of record on November 20, 2014.  

Marriott International, Inc. (NASDAQ: MAR) is a leading lodging global company based in Bethesda, Maryland, USA, with more than 4,100 properties in 79 countries and territories.  Marriott International reported revenues of nearly $13 billion in fiscal year 2013. The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands, including: Marriott Hotels, The Ritz-Carlton, JW Marriott, Bulgari, EDITION, Renaissance, Gaylord Hotels, Autograph Collection, AC Hotels by Marriott, Moxy Hotels, Courtyard, Fairfield Inn & Suites, SpringHill Suites, Residence Inn, TownePlace Suites, Protea Hotels, Marriott Executive Apartments and Marriott Vacation Club timeshare brand.  There are approximately 330,000 employees at headquarters, managed and franchised properties.  Marriott has been consistently recognized as a top employer and for its superior business ethics. The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 47 million members.  For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

Connect with Thomas.Marder@Marriott.com

10/28/2014

Marriott International Reports Third Quarter Results; Reaches Milestone 700,000 Rooms Worldwide

HIGHLIGHTS

• Third quarter diluted EPS totaled $0.65, a 25 percent increase over prior year results;
 
• North American comparable systemwide RevPAR rose 8.7 percent in the third quarter with average daily rates up 5.0 percent;

• On a constant dollar basis, worldwide comparable systemwide RevPAR rose 8.1 percent in the third quarter, including a 4.5 percent increase in average daily rate;

• Marriott repurchased 4.5 million shares of the company’s common stock for $300 million during the third quarter.  To date in October, the company repurchased 3.9 million shares for $254 million.  Year-to-date, the company repurchased 20.4 million shares for $1.2 billion;

• Comparable company-operated house profit margins increased 240 basis points in North America and 200 basis points worldwide in the third quarter;

• Adjusted for cost reimbursements, the company’s operating income margin increased to 43 percent compared to 41 percent in the year-ago quarter;

• At the end of the third quarter, the company’s worldwide development pipeline increased to nearly 225,000 rooms, including approximately 37,000 rooms approved, but not yet subject to signed contracts;

• Nearly 6,900 rooms were added during the third quarter, including over 2,200 rooms in international markets.  At quarter-end, Marriott operated or franchised over 700,000 rooms worldwide;

• Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $393 million in the quarter, a 19 percent increase over third quarter 2013 adjusted EBITDA.

Bethesda, Md., October 28, 2014 - Marriott International, Inc. (NASDAQ: MAR) today reported third quarter 2014 results.

Third quarter 2014 net income totaled $192 million, a 20 percent increase over third quarter 2013 net income.  Diluted earnings per share (EPS) totaled $0.65, a 25 percent increase from diluted EPS in the year-ago quarter.  On July 29, 2014, the company forecasted third quarter diluted EPS of $0.59 to $0.63.

Arne M. Sorenson, president and chief executive officer of Marriott International, said, “We were very pleased with results in the quarter.  Our outperformance compared to the guidance we provided in July was largely due to stronger than expected RevPAR and margin growth.  North American systemwide RevPAR rose nearly 9 percent and occupancy reached an extraordinary 77.6 percent while room rates rose 5 percent.  Group demand was particularly strong with significant last minute bookings and high attendance.  With the addition of greater corporate and leisure demand, room rates surged to record levels in many North American markets.  Worldwide systemwide RevPAR increased more than 8 percent.

“Our development pipeline grew to nearly 225,000 rooms, approximately 40 percent of which are under construction.  We’re on a record-setting pace for room signings with 80,000 to 90,000 room signings expected during 2014.  Our portfolio of luxury and lifestyle brands continues to grow in response to terrific guest feedback and great demand by owners and developers around the world.  We opened our first Moxy hotel in Milan in September.  We expect to introduce the AC Hotels brand to the U.S. in November when the first property opens in New Orleans.  Our newest EDITION hotel also arrives in the U.S. next month with the opening of the Miami EDITION and Residences. 

“For 2015, we expect North American systemwide RevPAR to increase 5 to 7 percent, 4 to 6 percent outside North America and 5 to 7 percent worldwide.  Our group booking pace for the Marriott brand for 2015 is up at a mid-single digit rate with only about 60 percent of expected group business volume booked thus far.  With continued North American demand growth expected in 2015, we believe both group and transient room rates will continue to strengthen.  And, given our strong development pipeline, we anticipate 6 to 7 percent worldwide gross room additions in 2015.”

For the 2014 third quarter, RevPAR for worldwide comparable systemwide properties increased 8.1 percent (an 8.2 percent increase using actual dollars).

In North America, comparable systemwide RevPAR increased 8.7 percent in the third quarter of 2014, including a 5.0 percent increase in average daily rate.  RevPAR for comparable systemwide North American full-service hotels (including Marriott Hotels, The Ritz-Carlton, Renaissance Hotels, Gaylord Hotels and Autograph Collection Hotels) increased 8.8 percent with a 5.1 percent increase in average daily rate.  RevPAR for comparable systemwide North American limited-service hotels (including Courtyard, Residence Inn, SpringHill Suites, TownePlace Suites and Fairfield Inn & Suites) increased 8.6 percent in the third quarter with a 4.9 percent increase in average daily rate.

International comparable systemwide RevPAR rose 5.6 percent (a 6.4 percent increase using actual dollars) in the third quarter.

Marriott added 49 new properties (6,891 rooms) to its worldwide lodging portfolio in the 2014 third quarter including the first Moxy hotel in Milan, Italy.  Seven properties (1,279 rooms) exited the system during the quarter.  At quarter-end, the company’s lodging group encompassed 4,127 properties and timeshare resorts for a total of more than 702,000 rooms.

The company’s worldwide development pipeline increased to more than 1,300 properties with nearly 225,000 rooms at quarter-end, including 255 properties with approximately 37,000 rooms approved for development, but not yet subject to signed contracts.

MARRIOTT REVENUES totaled nearly $3.5 billion in the 2014 third quarter compared to revenues of nearly $3.2 billion for the third quarter of 2013.  Base management and franchise fees totaled $381 million compared to $325 million in the year-ago quarter, an increase of 17 percent.  The year-over-year increase largely reflects higher RevPAR and new unit growth.  The company recognized $9 million of deferred base management fees related to an owner’s sale of a Courtyard portfolio, $6 million of deferred base management fees related to the performance of a limited-service portfolio and $9 million of relicensing fees in the third quarter.  In the year-ago quarter, the company recognized $2 million of deferred base management fees related to the performance of a limited-service portfolio and $3 million of relicensing fees.

Third quarter worldwide incentive management fees increased 26 percent to $67 million primarily due to strong RevPAR, house profit margin and unit growth.  Incentive management fees from North American hotels increased 78 percent to $32 million compared to $18 million in the year-ago quarter.  The company anticipates that worldwide incentive management fee revenue will increase at a high teens rate for full year 2014.  In the third quarter, 51 percent of worldwide company-managed hotels earned incentive management fees compared to 32 percent in the year-ago quarter.

Worldwide comparable company-operated house profit margins increased 200 basis points in the third quarter with higher room rates, improved productivity and solid cost controls.  House profit margins for comparable company-operated properties outside North America increased 130 basis points and North American comparable company-operated house profit margins increased 240 basis points from the year-ago quarter.

Owned, leased, and other revenue, net of direct expenses, totaled $55 million, compared to $48 million in the year-ago quarter.  Improved results reflected strong performance at several leased hotels, the addition of a property the company acquired in the fourth quarter of 2013 and the impact of the Protea portfolio acquired in the second quarter of 2014, partially offset by the impact of renovations.

GENERAL, ADMINISTRATIVE, and OTHER expenses for the 2014 third quarter totaled $172 million, a 17 percent increase compared to the year-ago quarter.  The increase in expenses for the quarter largely reflected $6 million of higher incentive compensation expenses and $4 million of net unfavorable foreign exchange rates mainly due to devaluation of the Venezuelan Bolivar.  For the first three quarters of 2014, general and administrative expenses are 2 percent higher year-over-year.

On July 29, the company estimated general and administrative expenses for the third quarter would total $160 million to $165 million.  Actual expenses in the quarter were above the range largely due to the unfavorable foreign exchange impact mentioned above and higher incentive compensation expense reflecting strong performance.

EQUITY IN EARNINGS increased $12 million in the third quarter.  The increase largely reflected deferred tax true-ups due to tax law changes affecting two international joint ventures.

Provision for Income Taxes
The provision for income taxes in the third quarter was higher than anticipated due to a $6 million non-recurring tax item.

Adjusted Earnings before Interest Expense, Taxes, Depreciation and Amortization (EBITDA)
Adjusted EBITDA totaled $393 million in the 2014 third quarter, a 19 percent increase over 2013 third quarter adjusted EBITDA of $329 million.  See page A-8 for the EBITDA calculation.

BALANCE SHEET
At the end of the third quarter, total debt was $3,528 million and cash balances totaled $150 million, compared to $3,199 million in debt and $126 million of cash at year-end 2013.

At the beginning of the fourth quarter, the company issued $400 million of Series N Senior Notes due in 2021 with a 3.1 percent interest rate coupon.  The company expects to use the net proceeds for general corporate purposes.

COMMON STOCK
Weighted average fully diluted shares outstanding used to calculate diluted EPS totaled 295.4 million in the 2014 third quarter, compared to 309.5 million in the year-ago quarter.

The company repurchased 4.5 million shares of common stock in the third quarter at a cost of $300 million.  Year-to-date through October 28, Marriott repurchased 20.4 million shares of its stock for $1.2 billion at an average price of $59.36.  The remaining share authorization as of October 28, 2014, totaled 18.9 million shares.

OUTLOOK
For the 2014 fourth quarter, the company expects comparable systemwide RevPAR on a constant dollar basis will increase 5 to 7 percent in North America, 4 to 6 percent outside North America and 5 to 7 percent worldwide.

The company anticipates gross room additions of 7 percent worldwide for the full year 2014 including the 10,016 rooms associated with the Protea acquisition.  Net of deletions, the company expects its portfolio of rooms will increase by approximately 6 percent in 2014.

The company assumes full year fee revenue could total $1,714 million to $1,724 million, growth of 11 to 12 percent over 2013 fee revenue of $1,543 million. 

For 2014, the company anticipates general, administrative and other expenses will total $654 million to $659 million, up 1 to 2 percent compared to 2013 expenses of $649 million.

Given these assumptions, 2014 diluted EPS could total $2.48 to $2.52, a 24 to 26 percent increase year-over-year.  This full year EPS outlook includes the $0.07 of unfavorable adjustments reported in the second quarter.

 

Fourth Quarter 2014 Full Year 2014
 Total fee revenue         $425 million to $435 million              $1,714 million to $1,724 million
 Owned, leased and other revenue, net of direct expenses  Approx. $65 million      Approx. $239 million
Depreciation, amortization, and other expenses  Approx. $30 million      Approx. $146 million
 General, administrative, and other expenses      $175 million to $180 million  $654 million to $659 million
 Operating income      $280 million to $295 million  $1,148 million to $1,163 million
 Gains and other income      Approx. $3 million  Approx. $7 million
 Net interest expense1  Approx. $20 million  Approx. $92 million
 Equity in earnings (losses)  Approx. $(2) million  Approx. $4 million
 Earnings per share      $0.62 to $0.66  $2.48 to $2.52
 Tax rate    32.5 percent

1Net of interest income

The company expects investment spending in 2014 will total approximately $800 million to $900 million, including approximately $100 million for maintenance capital spending and $193 million associated with the Protea transaction.  Investment spending also includes other capital expenditures (including property acquisitions), new mezzanine financing and mortgage notes, contract acquisition costs, and equity and other investments.  Assuming this level of investment spending, approximately $1.6 billion to $1.7 billion could be returned to shareholders through share repurchases and dividends.

Based upon the assumptions above, the company expects full year 2014 adjusted EBITDA will total $1,507 million to $1,522 million, a 14 to 15 percent increase over the 2013 full year adjusted EBITDA of $1,325 million.  See page A-9 for the adjusted EBITDA calculation.

Marriott International, Inc. (NASDAQ: MAR) will conduct its quarterly earnings review for the investment community and news media on Wednesday, October 29, 2014 at 10 a.m. Eastern Time (ET).  The conference call will be webcast simultaneously via Marriott’s investor relations website at http://www.marriott.com/investor, click the “Recent and Upcoming Events” tab and click on the quarterly conference call link.  A replay will be available at that same website until October 29, 2015.

The telephone dial-in number for the conference call is 706-679-3455 and the conference ID is 59390131.  A telephone replay of the conference call will be available from 1 p.m. ET, Wednesday, October 29, 2014 until 8 p.m. ET, Wednesday, November 5, 2014.  To access the replay, call 404-537-3406.  The conference ID for the recording is 59390131.

Note on forward-looking statements:  This press release and accompanying schedules contain “forward-looking statements” within the meaning of federal securities laws, including RevPAR, profit margin and earnings trends, estimates and assumptions; the number of lodging properties we expect to add to or remove from our system in the future; our expectations about investment spending; and similar statements concerning anticipated future events and expectations that are not historical facts.  We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those we identify below and other risk factors that we identify in our most recent quarterly report on Form 10-Q.  Risks that could affect forward-looking statements in this press release include changes in market conditions; the continuation and pace of the economic recovery; supply and demand changes for hotel rooms; competitive conditions in the lodging industry; relationships with clients and property owners; and the availability of capital to finance hotel growth and refurbishment.  Any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release.  We make these forward-looking statements as of October 28, 2014.  We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Marriott International, Inc. (NASDAQ: MAR) is a global leading lodging company based in Bethesda, Maryland, USA, with more than 4,100 properties in 79 countries and territories.  Marriott International reported revenues of nearly $13 billion in fiscal year 2013.  The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands, including: Marriott Hotels, The Ritz-Carlton, JW Marriott, Bulgari, EDITION, Renaissance, Gaylord Hotels, Autograph Collection, AC Hotels by Marriott, Moxy Hotels, Courtyard, Fairfield Inn & Suites, SpringHill Suites, Residence Inn, TownePlace Suites, Protea Hotels, Marriott Executive Apartments and Marriott Vacation Club timeshare brand.  Marriott has been consistently recognized as a top employer and for its superior business ethics.  The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 47 million members.  For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

Click here to Download MAR Q3 2014 Press Release Schedules - FINAL

Contacts: 
Tom Marder, (301) 380-2553, thomas.marder@marriott.com 
Betsy Dahm, (301) 380-3372, betsy.dahm@marriott.com

09/08/2014

NOW & NEXT: Marriott International Charts Future Success

Atlantis, Paradise IslandRecord Growth, Powerful Portfolio Expected to Drive Profitability and Cash Flow to Shareholders

Bethesda, Md., September 8, 2014 – With plans to add over 1,300 hotels globally  – or more than six hotels a week – from 2014 through 2017, Marriott International, Inc. (NASDAQ: MAR) will tell a meeting of security analysts and institutional investors today that its portfolio could total over 5,000 hotels in 100 countries.  With a record pipeline already in place, Marriott expects to add between 200,000 and 235,000 new rooms around the world in 2014 through 2017.    

In presentations at the new Marriott Marquis Washington, D.C., the company will say assuming 6 percent RevPAR (Revenue per Available Room) growth in 2014, the midpoint of its current guidance, and 4 to 6 percent annual RevPAR growth in 2015 through 2017, the company could produce diluted earnings per share (EPS) of between $4.00 and $4.60 by 2017, a compound growth rate of 19 to 23 percent over the period.   Given these RevPAR assumptions, cash available for dividends and share repurchases could total $6.7 billion to $7.6 billion for the four years 2014 through 2017.

“This is a great time to be in the hotel business,” said Arne Sorenson, Marriott International president and chief executive officer.   “Around the world, this is a golden age of travel.  In 2012, international trips topped a record one billion, and we would like to see that double over the next 10 years.   Economic growth and rising middle classes are driving this travel, and we now have more hotels open or in development outside the U.S. than at any time in our company’s history.  In North America, we believe we are only midway through an elongated lodging cycle, with considerable upside to come.”

Discussing its operating model, the company will say that assuming the RevPAR growth detailed above, it would expect: 

  • Worldwide total fees of $2.2 billion to $2.4 billion by 2017, a 10 to 12 percent compound growth rate from 2013;
  • Incentive management fees of $445 million to $510 million in 2017, a 15 to 19 percent compound growth rate from 2013;
  • Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of between $2.1 billion to $2.3 billion by 2017, a 12 to 14 percent compound growth rate from 2013;
  • Operating income margins of 45 to 46 percent by 2017; and
  • Pre-tax return on invested capital of 48 to 53 percent by 2017.

The company’s investment spending for the three years from 2012 to 2014, including capital expenditures, note advances, contract acquisition costs and joint venture investments, is expected to total $2.0 billion to $2.2 billion, roughly 20 percent lower than that modeled for the same three-year period at the last analyst meeting in June 2012.  The company’s investment spending for the next three years, 2015 to 2017 is expected to total $1.6 billion to $1.8 billion, 20 percent lower still.

Marriott will say it is focused on aggressive growth in new markets and new brands.  In recent years, Marriott has introduced or acquired six brands, Gaylord, Moxy, EDITION, Protea, AC Hotels by Marriott and Autograph Collection, each positioned to capture a new customer or provide a new stay experience for our already loyal customers, and expected to account for 20 percent of the company’s unit growth through 2017.  In fact, the Autograph Collection is the fastest growing collection of independent full-service hotels and will soon welcome The Atlantis Paradise Island.

The company’s luxury and lifestyle portfolio is in position to capture the loyalties of Generations X and Y, which are expected to account for 90 percent of the working age population within a decade.  These exciting brands include The Ritz-Carlton, JW Marriott, Renaissance, EDITION, AC Hotels by Marriott, Moxy and Autograph Collection.

Marriott’s limited-service brands continue to drive growth in North America and are attracting a loyal following in markets abroad where their design reflects local tastes. Marriott also has the preeminent meetings and convention hotel network in the U.S., with the addition of Gaylord properties and hotels such as the Marriott Marquis Washington, D.C.   The company is reimagining and reinventing its first brand, Marriott Hotels, such as introducing the M Club lounge, which brings the concierge lounge to the first floor and boosts food and beverage sales and guest engagement.

In total, the company expects to open 200,000 to 235,000 rooms from 2014 to 2017.  Given the company’s RevPAR growth assumptions, these new rooms could generate roughly $360 million in fee revenue in 2017 or approximately $450 million annually once stabilized.

Marriott.com, one of the company’s most important connections to its customers, receives 35 million visits per month and booked a quarter of Marriott’s room nights in 2013, generating nearly $10 billion in gross room bookings.  The Marriott.com mobile app generated $1.3 billion of those bookings in 2013.

Another driver of growth is Marriott Rewards, ranked the most popular loyalty program in the industry by U.S. News & World Report. Its 47 million members account for 50 percent of all paid and stayed room nights.  

Regionally, in Asia Pacific, Marriott’s second largest region following North America, the company expects to double its portfolio by 2017, reaching 300 to 315 hotels in 19 countries.  China’s role in this growth is significant – almost 40 percent of the company’s 5 million Marriott Rewards members in the Asia Pacific region live in China.

Marriott’s growth in the Middle East and Africa region has doubled in less than three years.  By 2017, Marriott expects to have a portfolio of 31,000 to 33,000 rooms in 29 countries throughout the region, a 24 to 26 percent compound growth rate from 2013, driven significantly by Marriott’s acquisition earlier this year of South Africa’s Protea Hospitality Group.  

 “We are focused on growing a superior brand portfolio through long-term, high quality contracts with minimal investments, resulting in strong free cash flow, high return on invested capital and meaningful earnings growth,” said Carl Berquist, Marriott’s executive vice president and chief financial officer. “It’s a strategy that creates considerable shareholder value.”

Marriott International, Inc. is a global leading lodging company based in Bethesda, Maryland, USA, with more than 4,000 properties, and more than 690,000 rooms in 79 countries and territories.  Marriott International reported revenues of nearly $13 billion in fiscal year 2013.  The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands.  Marriott has been consistently recognized as a top employer and for its superior business ethics.  The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together comprise 47 million members.  For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com

Marriott will provide a live webcast of today’s investor and security analyst conference.  The live webcast will be available for U.S. investors on September 8, 2014 from approximately 10:00 am to 3:30 pm Eastern Daylight Time (EDT).  Slides and video from the meeting will be provided through a live webcast via Marriott’s investor relations web site.  The slides contain financial models for the four-year period, including estimates of earnings before interest, taxes, depreciation and amortization (EBITDA), return on invested capital, and free cash flow, as well as non-GAAP financial measure reconciliations for those estimates as appropriate.  Copies of the slides will be available for download approximately one hour before the start of the presentation.  Those wishing to access the webcast should log onto http://www.marriott.com/investor, and click on the Security Analyst Meeting link under the “Recent & Upcoming Events” tab.  Presentation materials from the meeting and the webcast replay will be available online after the meeting as well. Investor or analyst questions concerning the analyst conference should be addressed to Marriott Investor Relations at (301) 380-1379 or investorrelations@marriott.com.

Note on Forward Looking Statements:  This press release contains “forward-looking statements” within the meaning of federal securities laws, including RevPAR, profit margin and earnings trends; the number of lodging properties we may add in future years; our potential investment spending and similar statements concerning possible future events or expectations that are not historical facts.  We caution you that these statements are not guarantees of future performance and are subject to a number of risks and uncertainties, including changes in market conditions; the continuation and pace of the economic recovery; supply and demand changes for hotel rooms; competitive conditions in the lodging industry; relationships with clients and property owners; the availability of capital to finance hotel growth and refurbishment; and other risk factors that we identify in our most recent quarterly report on Form 10-Q; any of which could cause actual results to differ materially from the expectations we express or imply here.  We make these statements as of September 8, 2014 and we assume no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. 

For a complete set of Non-GAAP financial tables, click here: http://investor.shareholder.com/mar/reconciliations.cfm

Contact: Tom Marder
               (301) 380-2553
              thomas.marder@marriott.com

 

09/02/2014

Marriott International Security Analyst Meeting Webcast: September 8

Bethesda, Md., September 2, 2014Marriott International, Inc. (NASDAQ: MAR) announced today it will provide a live webcast of its upcoming Security Analyst Meeting.  The webcast will be available on Monday, September 8, 2014 from approximately 10:00 am to 3:30 pm Eastern Time (EDT).

Topics to be discussed at the meeting will include the strength of Marriott’s brands and marketing programs; the company’s hotel development strategies; and Marriott’s earnings prospects for 2017.  Speakers will also focus on the meaningful opportunities for the company in the North America, Africa, and Asia Pacific regions.

The live webcast will be provided through Marriott’s investor relations web site.  Copies of the slides will be available for download approximately one hour before the start of the presentation. 

Those wishing to access the webcast should log onto http://www.marriott.com/investor, and click on the Security Analyst Meeting link under the “Recent & Upcoming Events” tab.  Presentation materials from the meeting and the webcast replay will be available online after the meeting as well.  Investor or analyst questions concerning the analystconference should be addressed to Marriott Investor Relations at (301) 380-1379 or investorrelations@marriott.com.

Visit Marriott International, Inc. (NASDAQ: MAR) for company information. For more information or reservations, please visit our web site at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

Contacts: 
Tom Marder
Corporate Relations
(301) 380-7431
thomas.marder@marriott.com

Betsy Dahm
Investor Relations
(301) 380-3372
Betsy.dahm@marriott.com

08/07/2014

Marriott International Declares Cash Dividend

Bethesda, Md., August 7, 2014 - Marriott International, Inc. (NASDAQ: MAR) today announced that its board of directors declared a quarterly cash dividend of twenty cents ($0.20) per share of common stock.

The dividend is payable on September 26, 2014 to shareholders of record on August 21, 2014.

Marriott International, Inc. (NASDAQ: MAR) is a global leading lodging company based in Bethesda, Maryland, USA, with more than 4,000 properties, and more than 690,000 rooms in 78 countries and territories. Marriott International reported revenues of nearly $13 billion in fiscal year 2013. The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands. Marriott has been consistently recognized as a top employer and for its superior business ethics. The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 45 million members. For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

Connect with thomas.marder@marriott.com 

07/29/2014

Marriott International Reports 2014 Second Quarter Results

MI LogoHIGHLIGHTS

 Second quarter adjusted diluted EPS totaled $0.71, a 25 percent increase over prior year reported results.  Reported diluted EPS totaled $0.64;
 
• North American comparable systemwide RevPAR rose 6.0 percent in the second quarter with average daily rates up 3.7 percent;

• On a constant dollar basis, worldwide comparable systemwide RevPAR rose 5.8 percent in the second quarter, including a 3.5 percent increase in average daily rate;

• Marriott repurchased 5.0 million shares of the company’s common stock for $300 million during the second quarter.  Year-to-date, the company repurchased 12.8 million shares for $706 million;

• Comparable company-operated house profit margins increased 110 basis points in North America and 80 basis points worldwide in the second quarter;

• The company’s adjusted operating income margin increased to 47 percent compared to 43 percent in the year-ago quarter;

• At the end of the second quarter, the company’s worldwide development pipeline increased to nearly 215,000 rooms, including more than 30,000 rooms approved, but not yet subject to signed contracts;

• Over 18,700 rooms were added during the second quarter, including over 10,000 rooms associated with the Protea transaction and nearly 3,200 rooms in other international markets;

• Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $408 million in the quarter, a 10 percent increase over second quarter 2013 adjusted EBITDA.

BETHESDA, MD – July 29, 2014 - Marriott International, Inc. (NASDAQ: MAR) today reported second quarter 2014 results.

Second quarter 2014 net income totaled $192 million, a 7 percent increase compared to second quarter 2013 net income.  Diluted earnings per share (EPS) totaled $0.64, a 12 percent increase from diluted EPS in the year-ago quarter.  Second quarter 2014 results reflect a $15 million pretax ($9 million after-tax and $0.03 per diluted share) impairment charge, an $11 million pretax ($7 million after-tax and $0.02 per diluted share) litigation reserve and a $7 million pretax ($5 million after-tax and $0.02 per diluted share) unfavorable foreign exchange impact related to Venezuelan currency devaluation.  Excluding these items, second quarter adjusted net income totaled $213 million and adjusted diluted EPS was $0.71.  On April 29, 2014, the company forecasted second quarter diluted EPS of $0.63 to $0.68, which did not include the three items discussed above.  See page A-11 for the adjusted EPS calculation.

Arne M. Sorenson, president and chief executive officer of Marriott International, said, “Results in the quarter exceeded our expectations as worldwide RevPAR increased nearly 6 percent.  In North America, strong transient demand drove RevPAR higher and room rates rose nearly 4 percent.    

“With strong franchisee and owner demand for our brands, we are on pace to have another record development year in 2014 with contracts for roughly 295 hotels with nearly 46,000 rooms already signed, or nearly a dozen hotels per week, and well ahead of our 2013 first half signings pace.  At the end of the second quarter, our development pipeline reached a record 215,000 rooms.

“We were pleased to announce a few weeks ago that the 3,400-room Atlantis, Paradise Island will be joining the Autograph Collection later this year, further accelerating our growth in the luxury and lifestyle space.  The Autograph Collection is just one brand in our luxury and lifestyle portfolio (The Ritz-Carlton, Bulgari Hotels & Resorts, EDITION, JW Marriott Hotels, Autograph Collection, Renaissance Hotels, AC Hotels by Marriott, Protea Fire & Ice Hotels and Moxy Hotels) catering to next generation travelers, a fast growing customer segment.  Representing nearly 30 percent of our current development pipeline, we expect to increase our room distribution of these luxury and lifestyle brands by 50 percent over the next few years.

“We are bullish on the remainder of 2014.  The strong RevPAR growth in the second quarter combined with very strong group bookings for the third quarter give us the confidence to increase our full year 2014 North American and worldwide RevPAR growth guidance to 5 to 7 percent.  We are also increasing our expectations for gross room additions to 7 percent, 6 percent net, based on strong development interest in our brands.  Through the first two quarters, we have returned $766 million to our shareholders through dividends and share repurchases and are on pace to return $1.35 billion to $1.6 billion to shareholders for the full year.”

For the 2014 second quarter, RevPAR for worldwide comparable systemwide properties increased 5.8 percent (a 5.9 percent increase using actual dollars).

In North America, comparable systemwide RevPAR increased 6.0 percent in the second quarter of 2014, including a 3.7 percent increase in average daily rate.  RevPAR for comparable systemwide North American full-service hotels (including Marriott Hotels, The Ritz-Carlton, Renaissance Hotels, Gaylord Hotels and Autograph Collection Hotels) increased 5.3 percent with a 3.5 percent increase in average daily rate.  RevPAR for comparable systemwide North American limited-service hotels (including Courtyard, Residence Inn, SpringHill Suites, TownePlace Suites and Fairfield Inn & Suites) increased 6.8 percent in the second quarter with a 4.1 percent increase in average daily rate.

Excluding Venezuela, international comparable systemwide RevPAR rose 4.6 percent (a 5.1 percent increase using actual dollars) in the second quarter.

Marriott added 162 new properties (18,729 rooms) to its worldwide lodging portfolio in the 2014 second quarter, including 113 properties (10,016 rooms) related to the Protea transaction.  Nine properties (1,134 rooms) exited the system during the quarter.  At quarter-end, the company’s lodging group encompassed 4,087 properties and timeshare resorts for a total of nearly 697,000 rooms.

The company’s worldwide development pipeline increased to roughly 1,300 properties with nearly 215,000 rooms at quarter-end, including 213 properties with more than 30,000 rooms approved for development, but not yet subject to signed contracts.

MARRIOTT REVENUES totaled nearly $3.5 billion in the 2014 second quarter compared to revenues of approximately $3.3 billion for the second quarter of 2013.  Base management and franchise fees totaled $370 million compared to $343 million in the year-ago quarter, an increase of 8 percent.  The year-over-year increase largely reflects higher RevPAR and new unit growth.

Second quarter worldwide incentive management fees increased 28 percent to $82 million primarily due to strong RevPAR and unit growth, as well as favorable timing of fee recognition.  The company anticipates that incentive management fee revenue will increase at a high teens rate for full year 2014.  In the second quarter, 40 percent of worldwide company-managed hotels earned incentive management fees compared to 34 percent in the year-ago quarter.

Worldwide comparable company-operated house profit margins increased 80 basis points in the second quarter with improvement in both room rates and productivity.  House profit margins for comparable company-operated properties outside North America increased 30 basis points and North American comparable company-operated house profit margins increased 110 basis points from the year-ago quarter.

Owned, leased and other revenue, net of direct expenses, totaled $70 million, compared to $65 million in the year-ago quarter.  Improved results reflected strong performance at several leased hotels, the addition of a property the company acquired in the fourth quarter of 2013, the impact of the Protea portfolio acquired at the beginning of the quarter and higher residential and credit card branding fees, partially offset by $13 million of lower termination fees.  Results for the second quarter of 2013 included $4 million of expenses related to international lease terminations.

DEPRECIATION, AMORTIZATION, and OTHER expense totaled $47 million in the 2014 second quarter compared to $33 million in the year-ago quarter.  The increase in expense largely reflects a $15 million impairment charge resulting from the reallocation of costs between the Miami EDITION hotel and the Miami EDITION residences.  The estimated cost of the total Miami EDITION project, which includes both the hotel and residences, remains unchanged from last quarter.  Prior year results included a $5 million impairment of deferred contract acquisition cost.

GENERAL, ADMINISTRATIVE and OTHER expenses for the 2014 second quarter totaled $159 million, a 1 percent decline compared to the year-ago quarter.  Expenses for the quarter included a $7 million foreign exchange loss associated with the Venezuelan Bolivar.  Expenses in the second quarter of 2013 included a $5 million performance cure payment.

On April 29, the company estimated general and administrative expenses for the second quarter would total $165 million to $170 million.  Actual expenses in the quarter were below the range largely due to lower than expected spending, some of which was favorable timing, and lower bad debt expenses, partially offset by the foreign exchange impact discussed above.

GAINS AND OTHER INCOME totaled $3 million in the quarter compared to $10 million in the year-ago quarter.  In the 2013 second quarter, the company recorded an $8 million gain on the sale of an investment in equity securities.

EQUITY LOSSES increased $6 million in the second quarter to an $8 million dollar loss largely due to an $11 million litigation reserve.

Adjusted Earnings before Interest Expense, Taxes, Depreciation and Amortization (EBITDA)
Adjusted EBITDA totaled $408 million in the 2014 second quarter, a 10 percent increase over 2013 second quarter adjusted EBITDA of $372 million.  See page A-8 for the EBITDA calculation.

BALANCE SHEET
At the end of the second quarter, total debt was $3,404 million and cash balances totaled $192 million, compared to $3,199 million in debt and $126 million of cash at year-end 2013.

COMMON STOCK
Weighted average fully diluted shares outstanding used to calculate diluted EPS totaled 298.7 million in the 2014 second quarter, compared to 314.0 million in the year-ago quarter.

The company repurchased 5.0 million shares of common stock in the second quarter at a cost of $300 million.  Year-to-date, Marriott repurchased 12.8 million shares of its stock for $706 million.  The remaining share authorization as of July 29, 2014, totaled 26.5 million shares.

OUTLOOK
For the 2014 third quarter, the company expects comparable systemwide RevPAR on a constant dollar basis will increase 6 to 8 percent in North America, 4 to 6 percent outside North America and 5.5 to 7.5 percent worldwide.

The company expects full year 2014 comparable systemwide RevPAR on a constant dollar basis will increase 5 to 7 percent in North America, 4 to 6 percent outside North America and 5 to 7 percent worldwide.  On April 29, 2014, the company forecasted worldwide and North American RevPAR growth of 4.5 to 6.5 percent for full year 2014.

The company anticipates gross room additions of 7 percent worldwide for the full year 2014 including the 10,016 rooms associated with the Protea acquisition.  Net of deletions, the company expects its portfolio of rooms will increase by approximately 6 percent by year-end 2014. 

The company assumes full year fee revenue could total $1,685 million to $1,725 million, growth of 9 to 12 percent over 2013 fee revenue of $1,543 million. 

For 2014, the company anticipates general, administrative and other expenses will total $640 million to $650 million, flat to down 1 percent compared to 2013 expenses of $649 million.

Given these assumptions, 2014 diluted EPS could total $2.40 to $2.51, a 20 to 25 percent increase year-over-year.  This full year EPS outlook reflects reported second quarter results, including the $0.07 of unfavorable adjustments in the quarter.

 

Third Quarter 2014 Full Year 2014
 Total fee revenue          $425 million to $435 million              $1,685 million to $1,725 million
 Owned, leased and other revenue, net of direct expenses  Approx. $50 million      Approx. $235 million
Depreciation and amortization  Approx. $30 million      Approx. $145 million
 General, administrative and other expenses      $160 million to $165 million  $640 million to $650 million
 Operating income      $280 million to $295 million  $1,125 million to $1,175 million
 Gains and other income      Approx. $0 million  Approx. $5 million
 Net interest expense1  Approx. $25 million  Approx. $95 million
 Equity in earnings (losses)  Approx. $0 million  Approx. $(10) million
 Earnings per share      $0.59 to $0.63  $2.40 to $2.51
 Tax rate    32.0 percent

1Net of interest income

The company expects investment spending in 2014 will total approximately $800 million to $1.0 billion, including approximately $150 million for maintenance capital spending and $193 million associated with the Protea transaction.  Investment spending also includes other capital expenditures (including property acquisitions), new mezzanine financing and mortgage notes, contract acquisition costs, and equity and other investments.  Assuming this level of investment spending, approximately $1.35 billion to $1.6 billion could be returned to shareholders through share repurchases and dividends.

Based upon the assumptions above, the company expects full year 2014 adjusted EBITDA will total $1,465 million to $1,515 million, an 11 to 14 percent increase over the 2013 full year adjusted EBITDA of $1,325 million.  See page A-9 for the adjusted EBITDA calculation.

Marriott International, Inc. (NASDAQ: MAR) will conduct its quarterly earnings review for the investment community and news media on Wednesday, July 30, 2014 at 10 a.m. Eastern Time (ET).  The conference call will be webcast simultaneously via Marriott’s investor relations website at http://www.marriott.com/investor, click the “Recent and Upcoming Events” tab and click on the quarterly conference call link.  A replay will be available at that same website until July 30, 2015.

The telephone dial-in number for the conference call is 706-679-3455 and the conference ID is 59383825.  A telephone replay of the conference call will be available from 1 p.m. ET, Wednesday, July 30, 2014 until 8 p.m. ET, Wednesday, August 6, 2014.  To access the replay, call 404-537-3406.  The conference ID for the recording is 59383825.

Note on forward-looking statements: This press release and accompanying schedules contain “forward-looking statements” within the meaning of federal securities laws, including RevPAR, profit margin and earnings trends, estimates and assumptions; the number of lodging properties we expect to add to or remove from our system in the future; our expectations about investment spending; and similar statements concerning anticipated future events and expectations that are not historical facts.  We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those we identify below and other risk factors that we identify in our most recent quarterly report on Form 10-Q.  Risks that could affect forward-looking statements in this press release include changes in market conditions; the continuation and pace of the economic recovery; supply and demand changes for hotel rooms; competitive conditions in the lodging industry; relationships with clients and property owners; and the availability of capital to finance hotel growth and refurbishment.  Any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release.  We make these forward-looking statements as of July 29, 2014.  We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Marriott International, Inc. (NASDAQ: MAR) is a global leading lodging company based in Bethesda, Maryland, USA, with more than 4,000 properties in 79 countries and territories.  Marriott International reported revenues of nearly $13 billion in fiscal year 2013.  The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands, including: Marriott Hotels, The Ritz-Carlton, JW Marriott, Bulgari, EDITION, Renaissance, Gaylord Hotels, Autograph Collection, AC Hotels by Marriott, Moxy Hotels (expected opening in 2014), Courtyard, Fairfield Inn & Suites, SpringHill Suites, Residence Inn, TownePlace Suites, Protea Hotels, Marriott Executive Apartments and Marriott Vacation Club timeshare brand.  Marriott has been consistently recognized as a top employer and for its superior business ethics.  The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 45 million members.  For more information or reservations, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com

IRPR#1

For a complete set of financial tables, click here Download MAR Q2 2014 Press Release Schedules - FINAL

Contacts:
thomas.marder@marriott.com or betsy.dahm@marriott.com