Marriott International today provided an update to the company’s global workforce on the continuing impact of COVID-19 on its business.
The COVID-19 pandemic is having a more severe and sustained financial impact on Marriott’s business than 9/11 and the 2008 financial crisis, combined. From the first warning signs of this unprecedented event, the company took a number of steps to adapt and strengthen its business including reducing costs significantly and improving its liquidity. Today, Marriott informed its associates that the company will need to implement additional measures in light of the increasing likelihood that it will be some time before lodging demand and RevPAR levels recover. Specifically, the company informed above-property associates in the United States that furloughs and reduced work week schedules which began in April will be extended through October 2, 2020. Marriott is also rolling out a voluntary transition program for on-property and above-property associates in the United States who may choose to leave the company to pursue other opportunities. Similar voluntary programs are being considered in other parts of the world. Given the company’s expectation that prior levels of business will not return until beyond 2021, the company anticipates a significant number of above-property position eliminations later this year. The company is not able at this time to predict how many associates will be affected by these separations or any resulting charges or cost savings.
CAUTIONARY LANGUAGE CONCERNING FORWARD-LOOKING STATEMENTS
All statements in this update are made as of May 27, 2020. We undertake no obligation to publicly update or revise these statements, whether as a result of new information, future events or otherwise. This update contains "forward-looking statements" within the meaning of federal securities laws, including statements related to the expected effects on our business of the COVID-19 pandemic and efforts to contain it (COVID-19); future performance of the company and the company's hotels; measures we expect to take in response to COVID-19 and their duration and impact; 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 evolving risks and uncertainties that we may not be able to accurately predict or assess, including those we identify below and other risk factors that we identify in our Securities and Exchange Commission filings, including our most recent Quarterly Report on Form 10-Q. Risks that could affect forward-looking statements in this update include the duration and scope of COVID-19; actions governments, businesses and individuals take in response to the pandemic; the ability of our owners and franchisees to successfully navigate the impacts of COVID-19; the pace of recovery when the pandemic subsides; and the effects of steps we and our property owners and franchisees take to reduce operating costs and/or enhance certain health and cleanliness protocols at our hotels. Any of these factors could cause actual results to differ materially from the expectations we express or imply in this statement.