Delaware | 1-13881 | 52-2055918 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
10400 Fernwood Road, Bethesda, Maryland | 20817 | |
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. | Results of Operations and Financial Condition. |
Financial Results for the Quarter Ended June 30, 2015 Marriott International, Inc. (“Marriott”) today issued a press release reporting financial results for the quarter ended June 30, 2015. A copy of Marriott’s press release is attached as Exhibit 99 and incorporated by reference. |
Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits. The following exhibits are furnished with this report: |
Exhibit 99 | Press release issued on July 29, 2015, reporting financial results for the quarter ended June 30, 2015. |
MARRIOTT INTERNATIONAL, INC. | ||||||||
Date: July 29, 2015 | By: | /s/ Bao Giang Val Bauduin | ||||||
Bao Giang Val Bauduin | ||||||||
Controller and Chief Accounting Officer |
Exhibit No. | Description | |
99 | Press release issued on July 29, 2015, reporting financial results for the quarter ended June 30, 2015. |
• | Second quarter diluted EPS totaled $0.87, a 36 percent increase over prior year results; |
• | During the second quarter, the company recorded a $41 million pretax gain on the redemption of a preferred equity ownership interest and $22 million of pretax losses on the expected disposition of real estate. |
• | North American comparable systemwide constant dollar RevPAR rose 5.4 percent in the second quarter; |
• | On a constant dollar basis, worldwide comparable systemwide RevPAR rose 5.3 percent in the second quarter; |
• | Marriott repurchased 9.1 million shares of the company’s common stock for $714 million during the second quarter. Year-to-date through July 29, the company repurchased 17.3 million shares for $1.35 billion; |
• | The company added over 20,000 rooms during the second quarter, including 9,600 rooms associated with the Delta transaction and nearly 3,800 other rooms in markets outside the U.S.; |
• | At the end of the second quarter, the company’s worldwide development pipeline increased to more than 250,000 rooms, including approximately 35,000 rooms approved, but not yet subject to signed contracts; |
• | The company’s adjusted operating income margin increased to a record 50 percent compared to 47 percent in the year-ago quarter; |
• | Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $457 million in the quarter, a 12 percent increase over second quarter 2014 adjusted EBITDA. |
Third Quarter 2015 | Full Year 2015 | |
Total fee revenue | $470 million to $480 million | $1,890 million to $1,910 million |
Owned, leased, and other revenue, net of direct expenses | $50 million to $55 million | $250 million to $255 million |
Depreciation, amortization, and other expenses | Approx. $35 million | Approx. $140 million |
General, administrative, and other expenses | Approx. $165 million | $630 million to $640 million |
Operating income | $320 million to $335 million | $1,360 million to $1,395 million |
Gains and other income, net | Approx. $0 million | Approx. $20 million |
Net interest expense1 | Approx. $35 million | Approx. $135 million |
Equity in earnings (losses) | Approx. $0 million | Approx. $5 million |
Earnings per share | $0.72 to $0.76 | $3.10 to $3.18 |
Tax rate | 32.1 percent |
MARRIOTT INTERNATIONAL, INC. | |
PRESS RELEASE SCHEDULES | |
QUARTER 2, 2015 | |
TABLE OF CONTENTS | |
Condensed Consolidated Statements of Income | |
Total Lodging Products | |
Key Lodging Statistics | |
Adjusted EBITDA | |
Adjusted EBITDA Full Year Forecast | |
Adjusted Operating Income Margin | |
Adjusted Earnings Per Share, net of tax | |
Return on Invested Capital | |
Non-GAAP Financial Measures |
Three Months Ended | Three Months Ended | Percent | ||||||||
June 30, 2015 | June 30, 2014 | Better/(Worse) | ||||||||
REVENUES | ||||||||||
Base management fees | $ | 191 | $ | 176 | 9 | |||||
Franchise fees | 221 | 194 | 14 | |||||||
Incentive management fees | 81 | 82 | (1 | ) | ||||||
Owned, leased, and other revenue 1 | 243 | 269 | (10 | ) | ||||||
Cost reimbursements 2 | 2,953 | 2,763 | 7 | |||||||
Total Revenues | 3,689 | 3,484 | 6 | |||||||
OPERATING COSTS AND EXPENSES | ||||||||||
Owned, leased, and other - direct 3 | 183 | 199 | 8 | |||||||
Reimbursed costs | 2,953 | 2,763 | (7 | ) | ||||||
Depreciation, amortization, and other 4 | 32 | 47 | 32 | |||||||
General, administrative, and other 5 | 152 | 159 | 4 | |||||||
Total Expenses | 3,320 | 3,168 | (5 | ) | ||||||
OPERATING INCOME | 369 | 316 | 17 | |||||||
Gains and other income, net 6 | 20 | 3 | 567 | |||||||
Interest expense | (42 | ) | (30 | ) | (40 | ) | ||||
Interest income | 6 | 4 | 50 | |||||||
Equity in earnings (losses) 7 | 2 | (8 | ) | (125 | ) | |||||
INCOME BEFORE INCOME TAXES | 355 | 285 | 25 | |||||||
Provision for income taxes | (115 | ) | (93 | ) | (24 | ) | ||||
NET INCOME | $ | 240 | $ | 192 | 25 | |||||
EARNINGS PER SHARE | ||||||||||
Earnings per share - basic | $ | 0.88 | $ | 0.66 | 33 | |||||
Earnings per share - diluted | $ | 0.87 | $ | 0.64 | 36 | |||||
Basic Shares | 272.4 | 292.5 | ||||||||
Diluted Shares | 277.3 | 298.7 |
1 | Owned, leased, and other revenue includes revenue from the properties we own or lease, termination fees, branding fees, and other revenue. |
2 | Cost reimbursements include reimbursements from properties for Marriott-funded operating expenses. |
3 | Owned, leased, and other - direct expenses include operating expenses related to our owned or leased hotels, including lease payments and pre-opening expenses. |
4 | Depreciation, amortization, and other expenses include depreciation for fixed assets, amortization of capitalized costs incurred to acquire management, franchise, and license agreements, and any related impairments, accelerations, or write-offs. |
5 | General, administrative, and other expenses include our corporate and business segments overhead costs and general expenses. |
6 | Gains and other income, net includes gains and losses on: the sale of real estate, the sale or other-than-temporary impairment of joint ventures and investments, and results from cost method investments. |
7 | Equity in earnings (losses) include our equity in earnings or losses of unconsolidated equity method investments. |
Six Months Ended | Six Months Ended | Percent | ||||||||
June 30, 2015 | June 30, 2014 | Better/(Worse) | ||||||||
REVENUES | ||||||||||
Base management fees | $ | 356 | $ | 331 | 8 | |||||
Franchise fees | 425 | 357 | 19 | |||||||
Incentive management fees | 170 | 153 | 11 | |||||||
Owned, leased, and other revenue 1 | 500 | 503 | (1 | ) | ||||||
Cost reimbursements 2 | 5,751 | 5,433 | 6 | |||||||
Total Revenues | 7,202 | 6,777 | 6 | |||||||
OPERATING COSTS AND EXPENSES | ||||||||||
Owned, leased, and other - direct 3 | 377 | 384 | 2 | |||||||
Reimbursed costs | 5,751 | 5,433 | (6 | ) | ||||||
Depreciation, amortization, and other 4 | 76 | 83 | 8 | |||||||
General, administrative, and other 5 | 297 | 307 | 3 | |||||||
Total Expenses | 6,501 | 6,207 | (5 | ) | ||||||
OPERATING INCOME | 701 | 570 | 23 | |||||||
Gains and other income, net 6 | 20 | 3 | 567 | |||||||
Interest expense | (78 | ) | (60 | ) | (30 | ) | ||||
Interest income | 14 | 9 | 56 | |||||||
Equity in earnings (losses) 7 | 5 | (6 | ) | (183 | ) | |||||
INCOME BEFORE INCOME TAXES | 662 | 516 | 28 | |||||||
Provision for income taxes | (215 | ) | (152 | ) | (41 | ) | ||||
NET INCOME | $ | 447 | $ | 364 | 23 | |||||
EARNINGS PER SHARE | ||||||||||
Earnings per share - basic | $ | 1.63 | $ | 1.24 | 31 | |||||
Earnings per share - diluted | $ | 1.59 | $ | 1.21 | 31 | |||||
Basic Shares | 275.1 | 294.3 | ||||||||
Diluted Shares | 280.6 | 301.2 |
1 | Owned, leased, and other revenue includes revenue from the properties we own or lease, termination fees, branding fees, and other revenue. |
2 | Cost reimbursements include reimbursements from properties for Marriott-funded operating expenses. |
3 | Owned, leased, and other - direct expenses include operating expenses related to our owned or leased hotels, including lease payments and pre-opening expenses. |
4 | Depreciation, amortization, and other expenses include depreciation for fixed assets, amortization of capitalized costs incurred to acquire management, franchise, and license agreements, and any related impairments, accelerations, or write-offs. |
5 | General, administrative, and other expenses include our corporate and business segments overhead costs and general expenses. |
6 | Gains and other income, net includes gains and losses on: the sale of real estate, the sale or other-than-temporary impairment of joint ventures and investments, and results from cost method investments. |
7 | Equity in earnings (losses) include our equity in earnings or losses of unconsolidated equity method investments. |
Number of Properties | Number of Rooms | ||||||||||||
Brand | June 30, 2015 | June 30, 2014 | vs. June 30, 2014 | June 30, 2015 | June 30, 2014 | vs. June 30, 2014 | |||||||
North America Full Service | |||||||||||||
Marriott Hotels | 364 | 362 | 2 | 146,874 | 145,823 | 1,051 | |||||||
Renaissance Hotels | 81 | 80 | 1 | 28,322 | 28,422 | (100 | ) | ||||||
Autograph Collection Hotels | 49 | 35 | 14 | 11,562 | 9,075 | 2,487 | |||||||
Gaylord Hotels | 5 | 5 | — | 8,098 | 8,098 | — | |||||||
Delta Hotels and Resorts | 37 | — | 37 | 9,595 | — | 9,595 | |||||||
The Ritz-Carlton Hotels | 40 | 39 | 1 | 11,691 | 11,567 | 124 | |||||||
The Ritz-Carlton Residences | 32 | 32 | — | 3,812 | 3,812 | — | |||||||
EDITION Hotels | 2 | — | 2 | 568 | — | 568 | |||||||
EDITION Residences | 1 | — | 1 | 25 | — | 25 | |||||||
North America Limited Service | |||||||||||||
Courtyard | 895 | 866 | 29 | 126,409 | 122,907 | 3,502 | |||||||
Residence Inn | 681 | 655 | 26 | 83,227 | 79,840 | 3,387 | |||||||
TownePlace Suites | 260 | 231 | 29 | 26,111 | 23,109 | 3,002 | |||||||
Fairfield Inn & Suites | 743 | 712 | 31 | 68,375 | 65,098 | 3,277 | |||||||
SpringHill Suites | 327 | 313 | 14 | 38,652 | 36,836 | 1,816 | |||||||
AC Hotels by Marriott1 | 5 | — | 5 | 911 | — | 911 | |||||||
International | |||||||||||||
Marriott Hotels | 228 | 206 | 22 | 69,892 | 62,466 | 7,426 | |||||||
Marriott Executive Apartments | 27 | 28 | (1 | ) | 4,149 | 4,423 | (274 | ) | |||||
Renaissance Hotels | 78 | 79 | (1 | ) | 24,361 | 24,742 | (381 | ) | |||||
Autograph Collection Hotels1 | 37 | 26 | 11 | 9,428 | 3,283 | 6,145 | |||||||
Protea Hotels | 105 | 112 | (7 | ) | 9,864 | 9,995 | (131 | ) | |||||
The Ritz-Carlton Hotels | 48 | 46 | 2 | 14,057 | 13,510 | 547 | |||||||
The Ritz-Carlton Serviced Apartments | 4 | 4 | — | 579 | 579 | — | |||||||
The Ritz-Carlton Residences | 8 | 8 | — | 416 | 416 | — | |||||||
Bulgari Hotels & Resorts | 3 | 3 | — | 202 | 202 | — | |||||||
Bulgari Residences | 1 | — | 1 | 5 | — | 5 | |||||||
EDITION Hotels | 2 | 2 | — | 251 | 251 | — | |||||||
Courtyard | 107 | 101 | 6 | 21,374 | 20,205 | 1,169 | |||||||
Residence Inn | 7 | 4 | 3 | 717 | 421 | 296 | |||||||
Fairfield Inn & Suites | 4 | 3 | 1 | 622 | 482 | 140 | |||||||
AC Hotels by Marriott1 | 77 | 73 | 4 | 9,448 | 8,310 | 1,138 | |||||||
Moxy Hotels | 1 | — | 1 | 162 | — | 162 | |||||||
Timeshare2 | 58 | 62 | (4 | ) | 12,876 | 13,054 | (178 | ) | |||||
Total Lodging | 4,317 | 4,087 | 230 | 742,635 | 696,926 | 45,709 |
1 | Results for all AC Hotels by Marriott properties and five Autograph Collection properties are presented in the "Equity in earnings (losses)" caption of our Consolidated Statements of Income. |
2 | Timeshare unit and room counts are as of June 19, 2015 and June 20, 2014, the end of Marriott Vacation Worldwide's second quarter for 2015 and 2014, respectively. |
Comparable Company-Operated International Properties1 | |||||||||||||||||
Three Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Region | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Caribbean & Latin America | $ | 172.37 | 6.7 | % | 73.3 | % | 1.7 | % | pts. | $ | 235.10 | 4.2 | % | ||||
Europe | $ | 141.67 | 5.7 | % | 80.0 | % | 2.0 | % | pts. | $ | 177.18 | 3.1 | % | ||||
Middle East & Africa | $ | 110.57 | 0.1 | % | 62.2 | % | 2.3 | % | pts. | $ | 177.70 | -3.6 | % | ||||
Asia Pacific | $ | 113.67 | 5.3 | % | 74.0 | % | 4.8 | % | pts. | $ | 153.53 | -1.5 | % | ||||
Total International2 | $ | 130.83 | 5.1 | % | 74.5 | % | 3.1 | % | pts. | $ | 175.53 | 0.8 | % | ||||
Worldwide3 | $ | 140.02 | 5.4 | % | 77.4 | % | 1.2 | % | pts. | $ | 180.90 | 3.8 | % |
Comparable Systemwide International Properties1 | |||||||||||||||||
Three Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Region | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Caribbean & Latin America | $ | 147.83 | 5.0 | % | 72.3 | % | 1.4 | % | pts. | $ | 204.54 | 3.0 | % | ||||
Europe | $ | 131.80 | 4.1 | % | 77.2 | % | 1.4 | % | pts. | $ | 170.62 | 2.3 | % | ||||
Middle East & Africa | $ | 110.07 | 0.8 | % | 62.9 | % | 2.3 | % | pts. | $ | 175.05 | -2.9 | % | ||||
Asia Pacific | $ | 114.52 | 5.7 | % | 74.5 | % | 4.4 | % | pts. | $ | 153.74 | -0.5 | % | ||||
Total International2 | $ | 126.35 | 4.5 | % | 74.0 | % | 2.5 | % | pts. | $ | 170.68 | 0.9 | % | ||||
Worldwide3 | $ | 119.32 | 5.3 | % | 77.4 | % | 0.6 | % | pts. | $ | 154.26 | 4.4 | % |
1 | International includes properties located outside the United States and Canada, except for Worldwide which includes the United States and Canada. |
2 | Includes Marriott Hotels, Renaissance Hotels, Autograph Collection Hotels, The Ritz-Carlton, Bulgari, EDITION, Residence Inn, Courtyard, and Fairfield Inn & Suites properties. |
3 | Includes Marriott Hotels, Renaissance Hotels, Autograph Collection Hotels, Gaylord Hotels, The Ritz-Carlton, Bulgari, EDITION, Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
Comparable Company-Operated International Properties1 | |||||||||||||||||
Six Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Region | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Caribbean & Latin America | $ | 202.30 | 6.9 | % | 75.3 | % | 1.4 | % | pts. | $ | 268.52 | 4.9 | % | ||||
Europe | $ | 126.24 | 6.9 | % | 73.9 | % | 2.7 | % | pts. | $ | 170.92 | 2.9 | % | ||||
Middle East & Africa | $ | 119.42 | 4.9 | % | 63.6 | % | 4.7 | % | pts. | $ | 187.88 | -2.8 | % | ||||
Asia Pacific | $ | 116.15 | 5.5 | % | 72.9 | % | 4.4 | % | pts. | $ | 159.30 | -0.9 | % | ||||
Total International2 | $ | 131.60 | 6.2 | % | 72.4 | % | 3.5 | % | pts. | $ | 181.73 | 1.1 | % | ||||
Worldwide3 | $ | 135.50 | 5.9 | % | 74.5 | % | 1.5 | % | pts. | $ | 181.98 | 3.7 | % |
Comparable Systemwide International Properties1 | |||||||||||||||||
Six Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Region | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Caribbean & Latin America | $ | 166.39 | 5.4 | % | 72.5 | % | 1.0 | % | pts. | $ | 229.46 | 4.0 | % | ||||
Europe | $ | 117.61 | 5.3 | % | 71.2 | % | 2.1 | % | pts. | $ | 165.23 | 2.2 | % | ||||
Middle East & Africa | $ | 118.26 | 5.1 | % | 64.1 | % | 4.4 | % | pts. | $ | 184.60 | -2.0 | % | ||||
Asia Pacific | $ | 116.30 | 5.9 | % | 73.3 | % | 4.1 | % | pts. | $ | 158.72 | -0.1 | % | ||||
Total International2 | $ | 125.34 | 5.5 | % | 71.4 | % | 2.8 | % | pts. | $ | 175.53 | 1.3 | % | ||||
Worldwide3 | $ | 113.49 | 6.0 | % | 73.8 | % | 1.1 | % | pts. | $ | 153.78 | 4.4 | % |
1 | International includes properties located outside the United States and Canada, except for Worldwide which includes the United States and Canada. |
2 | Includes Marriott Hotels, Renaissance Hotels, Autograph Collection Hotels, The Ritz-Carlton, Bulgari, EDITION, Residence Inn, Courtyard, and Fairfield Inn & Suites properties. |
3 | Includes Marriott Hotels, Renaissance Hotels, Autograph Collection Hotels, Gaylord Hotels, The Ritz-Carlton, Bulgari, EDITION, Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
Comparable Company-Operated North American Properties | |||||||||||||||||
Three Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Brand | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Marriott Hotels | $ | 160.00 | 5.1 | % | 79.8 | % | 0.2 | % | pts. | $ | 200.54 | 4.7 | % | ||||
Renaissance Hotels | $ | 148.70 | 6.2 | % | 79.5 | % | -0.2 | % | pts. | $ | 187.12 | 6.5 | % | ||||
The Ritz-Carlton | $ | 267.47 | 3.2 | % | 74.9 | % | -0.1 | % | pts. | $ | 356.95 | 3.3 | % | ||||
Composite North American Full-Service1 | $ | 168.07 | 4.7 | % | 78.9 | % | 0.2 | % | pts. | $ | 213.08 | 4.4 | % | ||||
Courtyard | $ | 109.92 | 7.1 | % | 77.1 | % | 0.3 | % | pts. | $ | 142.49 | 6.6 | % | ||||
SpringHill Suites | $ | 104.62 | 8.9 | % | 80.9 | % | 0.8 | % | pts. | $ | 129.27 | 7.8 | % | ||||
Residence Inn | $ | 120.56 | 8.5 | % | 81.9 | % | 0.6 | % | pts. | $ | 147.15 | 7.8 | % | ||||
TownePlace Suites | $ | 83.02 | 11.4 | % | 80.8 | % | 2.5 | % | pts. | $ | 102.81 | 7.9 | % | ||||
Composite North American Limited-Service2 | $ | 111.21 | 7.5 | % | 78.7 | % | 0.4 | % | pts. | $ | 141.28 | 6.9 | % | ||||
Composite - All3 | $ | 144.52 | 5.6 | % | 78.8 | % | 0.3 | % | pts. | $ | 183.38 | 5.2 | % |
Comparable Systemwide North American Properties | |||||||||||||||||
Three Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Brand | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Marriott Hotels | $ | 137.65 | 4.9 | % | 76.7 | % | 0.1 | % | pts. | $ | 179.38 | 4.8 | % | ||||
Renaissance Hotels | $ | 130.33 | 5.4 | % | 78.0 | % | 0.0 | % | pts. | $ | 167.12 | 5.4 | % | ||||
Autograph Collection Hotels | $ | 185.73 | 3.1 | % | 79.4 | % | 0.3 | % | pts. | $ | 233.79 | 2.8 | % | ||||
The Ritz-Carlton | $ | 267.47 | 3.2 | % | 74.9 | % | -0.1 | % | pts. | $ | 356.95 | 3.3 | % | ||||
Composite North American Full-Service4 | $ | 146.24 | 4.6 | % | 76.9 | % | 0.1 | % | pts. | $ | 190.21 | 4.5 | % | ||||
Courtyard | $ | 108.41 | 7.0 | % | 77.7 | % | 0.8 | % | pts. | $ | 139.51 | 5.9 | % | ||||
Fairfield Inn & Suites | $ | 82.83 | 4.4 | % | 75.0 | % | -0.1 | % | pts. | $ | 110.49 | 4.5 | % | ||||
SpringHill Suites | $ | 95.51 | 5.1 | % | 78.7 | % | -0.2 | % | pts. | $ | 121.31 | 5.3 | % | ||||
Residence Inn | $ | 117.56 | 6.3 | % | 83.0 | % | 0.1 | % | pts. | $ | 141.63 | 6.2 | % | ||||
TownePlace Suites | $ | 81.39 | 5.2 | % | 79.3 | % | 0.4 | % | pts. | $ | 102.67 | 4.7 | % | ||||
Composite North American Limited-Service2 | $ | 102.23 | 6.1 | % | 78.7 | % | 0.3 | % | pts. | $ | 129.97 | 5.7 | % | ||||
Composite - All5 | $ | 117.89 | 5.4 | % | 78.0 | % | 0.2 | % | pts. | $ | 151.10 | 5.1 | % |
1 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, and The Ritz-Carlton properties. |
2 | Includes Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
3 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, The Ritz-Carlton, Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
4 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, Autograph Collection Hotels, and The Ritz-Carlton properties. |
5 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, Autograph Collection Hotels, The Ritz-Carlton, Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
Comparable Company-Operated North American Properties | |||||||||||||||||
Six Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Brand | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Marriott Hotels | $ | 150.98 | 4.8 | % | 76.4 | % | 0.2 | % | pts. | $ | 197.49 | 4.5 | % | ||||
Renaissance Hotels | $ | 143.92 | 7.5 | % | 78.0 | % | 0.9 | % | pts. | $ | 184.56 | 6.3 | % | ||||
The Ritz-Carlton | $ | 270.48 | 2.9 | % | 73.1 | % | -0.4 | % | pts. | $ | 370.22 | 3.5 | % | ||||
Composite North American Full-Service1 | $ | 161.22 | 4.7 | % | 76.0 | % | 0.3 | % | pts. | $ | 212.11 | 4.3 | % | ||||
Courtyard | $ | 102.13 | 8.3 | % | 73.0 | % | 1.3 | % | pts. | $ | 139.95 | 6.4 | % | ||||
SpringHill Suites | $ | 96.92 | 7.8 | % | 75.9 | % | 0.6 | % | pts. | $ | 127.77 | 7.0 | % | ||||
Residence Inn | $ | 113.32 | 7.8 | % | 78.5 | % | 0.3 | % | pts. | $ | 144.29 | 7.4 | % | ||||
TownePlace Suites | $ | 74.89 | 10.6 | % | 73.6 | % | 1.1 | % | pts. | $ | 101.80 | 8.9 | % | ||||
Composite North American Limited-Service2 | $ | 103.72 | 8.2 | % | 74.7 | % | 1.0 | % | pts. | $ | 138.88 | 6.7 | % | ||||
Composite - All3 | $ | 137.41 | 5.7 | % | 75.5 | % | 0.6 | % | pts. | $ | 182.10 | 4.9 | % |
Comparable Systemwide North American Properties | |||||||||||||||||
Six Months Ended June 30, 2015 and June 30, 2014 | |||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||
Brand | 2015 | vs. 2014 | 2015 | vs. 2014 | 2015 | vs. 2014 | |||||||||||
Marriott Hotels | $ | 131.06 | 5.3 | % | 73.5 | % | 0.2 | % | pts. | $ | 178.37 | 4.9 | % | ||||
Renaissance Hotels | $ | 125.41 | 6.9 | % | 75.6 | % | 1.0 | % | pts. | $ | 165.86 | 5.5 | % | ||||
Autograph Collection Hotels | $ | 180.70 | 3.9 | % | 77.3 | % | 0.4 | % | pts. | $ | 233.64 | 3.3 | % | ||||
The Ritz-Carlton | $ | 270.48 | 2.9 | % | 73.1 | % | -0.4 | % | pts. | $ | 370.22 | 3.5 | % | ||||
Composite North American Full-Service4 | $ | 140.59 | 5.0 | % | 73.9 | % | 0.3 | % | pts. | $ | 190.19 | 4.6 | % | ||||
Courtyard | $ | 100.34 | 8.1 | % | 73.4 | % | 1.6 | % | pts. | $ | 136.73 | 5.8 | % | ||||
Fairfield Inn & Suites | $ | 75.46 | 6.1 | % | 70.3 | % | 1.0 | % | pts. | $ | 107.40 | 4.6 | % | ||||
SpringHill Suites | $ | 89.34 | 6.2 | % | 75.1 | % | 0.6 | % | pts. | $ | 119.03 | 5.3 | % | ||||
Residence Inn | $ | 109.67 | 6.6 | % | 79.3 | % | 0.4 | % | pts. | $ | 138.32 | 6.1 | % | ||||
TownePlace Suites | $ | 76.53 | 6.6 | % | 75.1 | % | 0.8 | % | pts. | $ | 101.89 | 5.5 | % | ||||
Composite North American Limited-Service2 | $ | 94.78 | 7.1 | % | 74.5 | % | 1.0 | % | pts. | $ | 127.24 | 5.6 | % | ||||
Composite - All5 | $ | 111.08 | 6.2 | % | 74.3 | % | 0.8 | % | pts. | $ | 149.53 | 5.0 | % |
1 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, and The Ritz-Carlton properties. |
2 | Includes Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
3 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, The Ritz-Carlton, Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
4 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, Autograph Collection Hotels, and The Ritz-Carlton properties. |
5 | Includes Marriott Hotels, Renaissance Hotels, Gaylord Hotels, Autograph Collection Hotels, The Ritz-Carlton, Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites properties. |
Fiscal Year 2015 | |||||||||||
First Quarter | Second Quarter | Total | |||||||||
Net income | $ | 207 | $ | 240 | $ | 447 | |||||
Interest expense | 36 | 42 | 78 | ||||||||
Tax provision | 100 | 115 | 215 | ||||||||
Depreciation and amortization | 32 | 32 | 64 | ||||||||
Depreciation classified in Reimbursed costs | 14 | 14 | 28 | ||||||||
Interest expense from unconsolidated joint ventures | 1 | — | 1 | ||||||||
Depreciation and amortization from unconsolidated joint ventures | 3 | 2 | 5 | ||||||||
EBITDA ** | 393 | 445 | 838 | ||||||||
EDITION impairment charge | 12 | — | 12 | ||||||||
Losses on expected disposition of real estate | — | 22 | 22 | ||||||||
Gain on redemption of preferred equity ownership interest | — | (41 | ) | (41 | ) | ||||||
Share-based compensation (including share-based compensation reimbursed by third-party owners) | 24 | 31 | 55 | ||||||||
Adjusted EBITDA ** | $ | 429 | $ | 457 | $ | 886 | |||||
Increase over 2014 Quarterly Adjusted EBITDA ** | 27 | % | 12 | % | 19 | % |
Fiscal Year 2014 | |||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Total | |||||||||||||||
Net income | $ | 172 | $ | 192 | $ | 192 | $ | 197 | $ | 753 | |||||||||
Interest expense | 30 | 30 | 29 | 26 | 115 | ||||||||||||||
Tax provision | 59 | 93 | 98 | 85 | 335 | ||||||||||||||
Depreciation and amortization | 26 | 32 | 33 | 32 | 123 | ||||||||||||||
Depreciation classified in Reimbursed costs | 12 | 13 | 13 | 13 | 51 | ||||||||||||||
Interest expense from unconsolidated joint ventures | 1 | 1 | — | 1 | 3 | ||||||||||||||
Depreciation and amortization from unconsolidated joint ventures | 4 | 3 | 1 | 2 | 10 | ||||||||||||||
EBITDA ** | 304 | 364 | 366 | 356 | 1,390 | ||||||||||||||
EDITION impairment charge | 10 | 15 | — | — | 25 | ||||||||||||||
Share-based compensation (including share-based compensation reimbursed by third-party owners) | 25 | 29 | 27 | 28 | 109 | ||||||||||||||
Adjusted EBITDA ** | $ | 339 | $ | 408 | $ | 393 | $ | 384 | $ | 1,524 |
** | Denotes non-GAAP financial measures. Please see pages A-13 and A-14 for information about our reasons for providing these alternative financial measures and the limitations on their use. |
Range | |||||||||||
Estimated EBITDA Fiscal Year 2015 | As Reported Fiscal Year 2014 | ||||||||||
Net income | $ | 849 | $ | 872 | $ | 753 | |||||
Interest expense | 165 | 165 | 115 | ||||||||
Tax provision | 401 | 413 | 335 | ||||||||
Depreciation and amortization | 128 | 128 | 123 | ||||||||
Depreciation classified in Reimbursed costs | 60 | 60 | 51 | ||||||||
Interest expense from unconsolidated joint ventures | 5 | 5 | 3 | ||||||||
Depreciation and amortization from unconsolidated joint ventures | 10 | 10 | 10 | ||||||||
EBITDA ** | 1,618 | 1,653 | 1,390 | ||||||||
EDITION impairment charge | 12 | 12 | 25 | ||||||||
Losses on expected disposition of real estate | 22 | 22 | — | ||||||||
Gain on redemption of preferred equity ownership interest | (41 | ) | (41 | ) | — | ||||||
Share-based compensation (including share-based compensation reimbursed by third-party owners) | 110 | 110 | 109 | ||||||||
Adjusted EBITDA ** | $ | 1,721 | $ | 1,756 | $ | 1,524 | |||||
Increase over 2014 Adjusted EBITDA** | 13 | % | 15 | % |
** | Denotes non-GAAP financial measures. See pages A-13 and A-14 for information about our reasons for providing these alternative financial measures and the limitations on their use. |
ADJUSTED OPERATING INCOME MARGIN | Second Quarter 2015 | Second Quarter 2014 | |||||
Total revenues, as reported | $ | 3,689 | $ | 3,484 | |||
Less: cost reimbursements | (2,953 | ) | (2,763 | ) | |||
Total revenues, as adjusted ** | $ | 736 | $ | 721 | |||
Operating income | $ | 369 | $ | 316 | |||
Add: EDITION impairment charge | — | 15 | |||||
Add: Venezuela currency loss | — | 7 | |||||
Operating income, as adjusted** | $ | 369 | $ | 338 | |||
Adjusted operating income margin** | 50 | % | 47 | % |
** | Denotes non-GAAP financial measures. See pages A-13 and A-14 for information about our reasons for providing these alternative financial measures and the limitations on their use. |
Second Quarter 2015 | Second Quarter 2014 | ||||||
Net income, as reported | $ | 240 | $ | 192 | |||
Add: EDITION impairment charge, net of tax | — | 9 | |||||
Add: Venezuela currency loss, net of tax | — | 5 | |||||
Add: Litigation reserve, net of tax | — | 7 | |||||
Add: Losses on expected disposition of real estate, net of tax | 13 | — | |||||
Less: Gain on redemption of preferred equity ownership interest, net of tax | (25 | ) | — | ||||
Net income, as adjusted** | $ | 228 | $ | 213 | |||
Diluted EPS, as reported | $ | 0.87 | $ | 0.64 | |||
Add: EDITION impairment charge, net of tax | — | 0.03 | |||||
Add: Venezuela currency loss, net of tax | — | 0.02 | |||||
Add: Litigation reserve, net of tax | — | 0.02 | |||||
Add: Losses on expected disposition of real estate, net of tax | 0.04 | — | |||||
Less: Gain on redemption of preferred equity ownership interest, net of tax | (0.09 | ) | — | ||||
Diluted EPS, as adjusted** | $ | 0.82 | $ | 0.71 | |||
Diluted Shares | 277.3 | ||||||
Increase over 2014 Diluted EPS | 36 | % | |||||
Adjusted increase over 2014 Diluted EPS, as adjusted ** | 15 | % |
** | Denotes non-GAAP financial measures. See pages A-13 and A-14 for information about our reasons for providing these alternative financial measures and the limitations on their use. |
The reconciliation of net income to earnings before interest expense and taxes is as follows: | |||||||
Twelve Months Ended June 30, 2015 | |||||||
Net income | $ | 836 | |||||
Interest expense | 133 | ||||||
Tax provision | 398 | ||||||
Earnings before interest expense and taxes ** | $ | 1,367 | |||||
The reconciliations of assets to invested capital are as follows: | |||||||
Twelve Months Ended June 30, 2015 | Twelve Months Ended June 30, 2014 | ||||||
Assets | $ | 6,321 | $ | 6,830 | |||
Less: current liabilities, net of current portion of long-term debt | (2,903 | ) | (2,683 | ) | |||
Less: deferred tax assets, net 1 | (684 | ) | (800 | ) | |||
Invested capital ** | $ | 2,734 | $ | 3,347 | |||
Average invested capital 2 ** | $ | 3,041 | |||||
Return on invested capital ** | 45 | % |
1 | Deducted because the numerator of the calculation is a pre-tax number. At June 30, 2015 and 2014, "Deferred tax assets, net" is also net of "current deferred income tax liabilities" of $22 million and $19 million, respectively. |
2 | Calculated as "Invested capital" for the current year and prior year, divided by two. |
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