Marriott International has reported a earnings totalling $900m (£689m) in its third quarter results, a 12% increase on earnings recorded in last year’s third quarter.
The company had estimated earnings for the quarter to be around $845-870m (£647-666m) – the higher figure being due to strong credit card and residential branding fee revenue, higher than expected termination fees, and lower than expected general, administrative, and other expenses.
The hotel company describes itself as “in the home stretch” of its integration with Starwood and reported net income of $483m (£370m) for the period, flat compared to last year, and a 1.9% increase in revenue per available room (revpar).
Marriott added more than 18,000 rooms during the third quarter, including more than 1,500 rooms converted from competitor brands, and Marriott’s worldwide development pipeline increased to roughly 471,000 rooms.
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 18 August, 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 totalling more than $1.5b (£1.15b) by the end of 2018. We have already exceeded that goal, recycling more than $1.8b (£1.38b) since the deal closed.
“In the third quarter, we were pleased to post gross fee revenues growth of 13% and adjusted EBITDA growth of 12%, as worldwide comparable systemwide hotel revpar increased roughly 2%. Our results in the third quarter highlight the resiliency of our asset light model and our ability to generate cash. Year-to-date through 5 November, we have already returned more than $3.1b (£2.37b) to shareholders through dividends and share repurchases and now believe we could return roughly $3.7b (£2.83b) in 2018.”
For its full year results, Marriott expects revpar to increase roughly 3% worldwide, while earnings are expected to amount to $3.46-3.47b (£2.65-2.66b), a 10-11% increase over 2017’s $3.13m (£2.4b).