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Marriott's first-quarter results 'dramatically impacted' by Covid-19

12 May 2020 by
Marriott's first-quarter results 'dramatically impacted' by Covid-19

Marriott's first-quarter results have been "dramatically impacted" by Covid-19, with a net income totalling $31m (£25m) compared with $375m (£304m) for last year's first-quarter.

Despite the company's worldwide revenue per available room (revpar) beginning the year with a "strong" 4.6% growth rate for January (excluding Greater China), the global revpar fell sharply and declined by approximately 90% in April.

The company reported operating income totalling $114m (£92m) in the 2020 first-quarter, compared to last year's first-quarter of $510m (£413m).

However Arne M. Sorenson, president and chief executive of Marriott International, expressed a degree of optimism, saying that the "resilience of travel demand" was "evident" in the improving trends in Greater China, with occupancy at hotels there reaching 25% in April, up from less than 10% in mid-February 2020.

"Looking at our occupancy and booking trends, it appears that lodging demand in most of the rest of the world has stabilised, albeit at very low levels. Occupancy was around 20% over the past two weeks in North American limited-service hotels, benefiting from leisure and drive-to demand."

Sorenson said that while global restrictions were starting to ease, the hotel group was preparing to welcome back staff and guests and that it would be rolling out a "multi-pronged platform to elevate cleanliness standards and hospitality norms to respond to the new health and safety challenges presented by the current pandemic environment".

He added: "These are extremely challenging times, but I am confident that we will be able to successfully navigate through them."

The company, with rooms across 134 countries and territories, added more than 14,500 rooms globally during the 2020 first-quarter, including nearly 2,100 rooms converted from competitor brands and approximately 7,200 rooms in international markets, representing an increase of 4.4% in net rooms compared with last year.

While the company anticipated significantly lower new room openings than previously budgeted for pre-Covid, it said they were already seeing "an uptick in owner interest in discussing conversions to our brands".

In recent weeks the company said it had raised $920m (£746m) in additional liquidity through amendments to its co-brand credit card agreements.

Marriott International has a portfolio of 7,400 properties under 30 brands across the world.

Image: Shutterstock

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