Marriott doubles revenue despite omicron setback
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2 min read . Updated: 15 Feb 2022, 07:14 PM IST - Company says systemwide occupancy rose 23% from a year earlier but was 12% below pre-pandemic levels
Marriott International Inc. said demand for business and leisure travel continued to grow in the holiday quarter despite a setback from the spread of the Omicron variant.
Marriott, whose portfolio encompasses nearly 8,000 properties world-wide, said Tuesday that its quarterly revenue more than doubled to $4.45 billion from a year earlier, when Covid-19 cases were surging and health officials warned against travel.
“While Omicron caused a temporary setback in global demand recovery in January, especially for business transient and group travel, new bookings across customer segments have rebounded to pre-Omicron levels," Chief Executive Anthony Capuano said.
The Bethesda, Md., company could begin returning cash to shareholders again later this year if there’s no further meaningful slowdown in the global economic recovery, Mr. Capuano said.
Marriott shares climbed 3% in premarket trading to $176.50 a share. The stock rose 25% last year and is up almost 4% so far in 2022.
Hotels, like other businesses, are grappling with the effects of rising costs. Marriott has seen its total costs balloon 66% over the past year to $3.81 billion. The company said base management and franchise fees roughly doubled to $737 million.
Many hotels, after suspending housekeeping at the start of the pandemic, now clean only when guests request it. The practice began over infection concerns, and some guests still prefer not to have staff in their rooms during stays. The cutbacks also reflect staffing shortages, lower occupancies and hotel owners’ desire to reduce expenses, hotel analysts say.
The company said systemwide occupancy came in at 58%, up 23% from a year earlier but still 12% below pre-pandemic levels.
Comparable systemwide revenue per available room, a closely watched industry metric known as RevPAR, was $90.86, more than double what it was a year earlier but about 19% below 2019 levels.
The company posted net income of $468 million, or $1.42 a share, compared with a loss of $164 million, or 50 cents a share, a year earlier. Adjusted for merger-related costs and other one-time charges, earnings were $1.30 a share. Analysts surveyed by FactSet were expecting $1 a share.
Marriott’s quarterly revenue of $4.45 billion beat the $3.99 billion that analysts expected, according to FactSet.
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This story has been published from a wire agency feed without modifications to the text
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