Marriott beats expectations in fourth quarter
The world’s largest hotelier, Marriott International, posted fourth quarter earnings results for 2016 towards the end of last week. This quarter was important for investors, shedding a little more light on Marriott post-Starwood acquisition, which was completed on September 26 2016. The good news is that Marriott smashed its own performance from the year ago, beat analysts’ expectations on revenue, and looks strong going into 2017. The bad news is… well, there isn’t any, actually.
Marriott’s up 8% so far this year
SOURCE: Yahoo Finance
Marriott’s adjusted diluted earnings per share were up by 20% from the year-ago period at $0.85 – this was in line with analysts’ expectations, but the company’s revenue came in at $5.46 billion, against estimates of $5.04 billion. Adjusted EBITDA increased by a confortable 11%.
Marriott’s president and CEO, Arne Sorenson, said:
"The company delivered record high fee revenues in 2016, boosted by significant unit growth, RevPAR improvement, outstanding property-level margin gains and the acquisition of Starwood Hotels & Resorts. We added 11 leading brands to our portfolio as a result of the acquisition and welcomed the 6,000th hotel to our system. Together with owners and franchisees, Marriottt and Starwood added more than 68,000 rooms during the year and, despite a tightening credit market, drove our pipeline of hotels under development to more than 420,000 rooms.
“Looking ahead, we've never been more optimistic about our long-term prospects. Our expected new rooms growth for 2017 remains healthy, customers love our hotels and loyalty programs, and owners and franchisees prefer our portfolio of brands more than ever. Around the globe, Marriottt brands represent nearly one in four hotels under construction, and one in three hotels under construction in North America.”
He went on to praise Marriott’s ‘proven’ business model, and offered the following guidance for 2017: the company expects to grow its rooms distribution by 6% throughout the year, and estimates a return of $1.5 billion to $2 billion to shareholders via repurchases and dividends.
Unsurprisingly, Marriott’s share price has been rising since the results were released – but to be fair to Marriott, it’s been rising all year too.
Dominion holds Marriott International in its Global Trends Luxury Fund.
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