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)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter) |
Emerging growth company | o | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | o |
Item 2.02. | Results of Operations and Financial Condition. |
Financial Results for the Quarter Ended March 31, 2018 Marriott International, Inc. (“Marriott”) today issued a press release reporting financial results for the quarter ended March 31, 2018. A copy of Marriott’s press release and earnings conference call slides are attached as Exhibits 99.1 and 99.2, respectively, and incorporated by reference. |
Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits. The following exhibits are furnished with this report: |
MARRIOTT INTERNATIONAL, INC. | ||||||||
Date: May 8, 2018 | By: | /s/ Bao Giang Val Bauduin | ||||||
Bao Giang Val Bauduin | ||||||||
Controller and Chief Accounting Officer |
• | First quarter reported diluted EPS totaled $1.09, a 15 percent increase from prior year results. First quarter adjusted diluted EPS totaled $1.34, a 40 percent increase over first quarter 2017 adjusted results. Adjusted results exclude merger-related adjustments, cost reimbursement revenue and reimbursed expenses. Adjusted results for the first quarter of 2018 also exclude adjustments to the provision for income taxes and the Avendra gain; |
• | First quarter 2018 comparable systemwide constant dollar RevPAR rose 3.6 percent worldwide, 7.5 percent outside North America and 2.0 percent in North America; |
• | The company added nearly 15,000 rooms during the first quarter, including roughly 1,600 rooms converted from competitor brands and approximately 5,800 rooms in international markets; |
• | At quarter-end, Marriott’s worldwide development pipeline increased to more than 2,700 hotels and nearly 465,000 rooms, including roughly 34,000 rooms approved, but not yet subject to signed contracts; |
• | First quarter reported net income totaled $398 million, a 7 percent increase from prior year results. First quarter adjusted net income totaled $487 million, a 30 percent increase over prior year adjusted results; |
• | Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $770 million in the quarter, an 8 percent increase over first quarter 2017 adjusted EBITDA; |
• | Marriott repurchased 5.6 million shares of the company’s common stock for $782 million during the first quarter. Year-to-date through May 8, the company has repurchased 7.9 million shares for $1.1 billion. |
Second Quarter 2017 | Full Year 2017 | |
Base management fees | $285 million | $1,102 million |
Franchise fees | $408 million | $1,586 million |
Incentive management fees | $155 million | $607 million |
Gross Fee Revenues | $848 million | $3,295 million |
Adjusted EBITDA | $820 million | $3,131 million |
Second Quarter 2018 1 | Full Year 2018 1 | |
Gross fee revenues | $935 million to $945 million | $3,650 million to $3,690 million |
Contract investment amortization | Approx. $15 million | Approx. $60 million |
Owned, leased, and other revenue, net of direct expenses | Approx. $80 million | Approx. $300 million |
Depreciation, amortization, and other expenses | Approx. $55 million | Approx. $225 million |
General, administrative, and other expenses | Approx. $250 million | $940 million to $950 million |
Operating income | $695 million to $705 million | $2,715 million to $2,765 million |
Gains and other income | Approx. $10 million | $65 million to $70 million |
Net interest expense | Approx. $80 million | Approx. $305 million |
Equity in earnings (losses) | Approx. $10 million | Approx. $40 million |
Earnings per share2 | $1.34 to $1.36 | $5.43 to $5.55 |
Tax rate2 | 23 percent |
1 | The outlook provided in this table does not include merger-related costs and charges, cost reimbursement revenue or reimbursed expenses. Full year 2018 outlook excludes the net tax charge resulting from the Tax Act and the increase in the Avendra gain, which were reported in the 2018 first quarter. |
2 | Guidance for Full Year 2018 reflects the impact of employee stock-based compensation excess tax benefits. 2018 estimated EPS assumes a $0.12 favorable impact and the company’s tax rate assumes a $41 million favorable impact from these benefits. |
MARRIOTT INTERNATIONAL, INC. | |
PRESS RELEASE SCHEDULES | |
TABLE OF CONTENTS | |
QUARTER 1, 2018 | |
Consolidated Statements of Income - As Reported | |
Non-GAAP Financial Measures | |
Total Lodging Products | |
Key Lodging Statistics | |
Adjusted EBITDA | |
Adjusted EBITDA Forecast - Second Quarter 2018 | |
Adjusted EBITDA Forecast - Full Year 2018 | |
Explanation of Non-GAAP Financial and Performance Measures |
As Reported | As Reported 10 | Percent | ||||||||
Three Months Ended | Three Months Ended | Better/(Worse) | ||||||||
March 31, 2018 | March 31, 2017 | Reported 2018 vs. 2017 | ||||||||
REVENUES | ||||||||||
Base management fees | $ | 273 | $ | 264 | 3 | |||||
Franchise fees 1 | 417 | 355 | 17 | |||||||
Incentive management fees | 155 | 140 | 11 | |||||||
Gross Fee Revenues | 845 | 759 | 11 | |||||||
Contract investment amortization 2 | (18 | ) | (11 | ) | (64 | ) | ||||
Net Fee Revenues | 827 | 748 | 11 | |||||||
Owned, leased, and other revenue 3 | 406 | 428 | (5 | ) | ||||||
Cost reimbursement revenue 4 | 3,773 | 3,736 | 1 | |||||||
Total Revenues | 5,006 | 4,912 | 2 | |||||||
OPERATING COSTS AND EXPENSES | ||||||||||
Owned, leased, and other - direct 5 | 336 | 356 | 6 | |||||||
Reimbursed expenses 4 | 3,835 | 3,696 | (4 | ) | ||||||
Depreciation, amortization, and other 6 | 54 | 51 | (6 | ) | ||||||
Merger-related costs and charges | 34 | 51 | 33 | |||||||
General, administrative, and other 7 | 247 | 212 | (17 | ) | ||||||
Total Expenses | 4,506 | 4,366 | (3 | ) | ||||||
OPERATING INCOME | 500 | 546 | (8 | ) | ||||||
Gains and other income, net 8 | 59 | — | * | |||||||
Interest expense | (75 | ) | (70 | ) | (7 | ) | ||||
Interest income | 5 | 7 | (29 | ) | ||||||
Equity in earnings 9 | 13 | 11 | 18 | |||||||
INCOME BEFORE INCOME TAXES | 502 | 494 | 2 | |||||||
Provision for income taxes | (104 | ) | (123 | ) | 15 | |||||
NET INCOME | $ | 398 | $ | 371 | 7 | |||||
EARNINGS PER SHARE | ||||||||||
Earnings per share - basic | $ | 1.11 | $ | 0.96 | 16 | |||||
Earnings per share - diluted | $ | 1.09 | $ | 0.95 | 15 | |||||
Basic Shares | 358.4 | 384.9 | ||||||||
Diluted Shares | 363.3 | 390.0 |
1 | Franchise fees include fees from our franchise agreements, application and relicensing fees, licensing fees from our timeshare, credit card programs, and residential branding fees. |
2 | Contract investment amortization includes amortization of payments made to obtain contracts with our owner and franchisee customers, and any related impairments, accelerations, or write-offs. |
3 | Owned, leased, and other revenue includes revenue from the properties we own or lease, termination fees, and other revenue. |
4 | Cost reimbursement revenue includes reimbursements from properties for property-level and centralized programs and services that we operate for the benefit of our hotel owners. Reimbursed expenses include costs incurred by Marriott for certain property-level operating expenses and centralized programs and services. |
5 | Owned, leased, and other - direct expenses include operating expenses related to our owned or leased hotels, including lease payments and pre-opening expenses. |
6 | 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. |
7 | General, administrative, and other expenses include our corporate and business segments overhead costs and general expenses. |
8 | Gains and other income, net includes gains and losses on the sale of real estate, the sale or impairment of joint ventures and investments, and results from other equity investments. |
9 | Equity in earnings include our equity in earnings or losses of unconsolidated equity method investments. |
10 | On January 1, 2018, we adopted ASU 2014-09. This column reflects our recast 2017 results under the new accounting standard. |
Three Months Ended | ||||||||||
March 31, 2018 | March 31, 2017 1 | Percent Better/(Worse) | ||||||||
Total revenues, as reported | $ | 5,006 | $ | 4,912 | ||||||
Less: Cost reimbursement revenue | (3,773 | ) | (3,736 | ) | ||||||
Adjusted total revenues** | 1,233 | 1,176 | ||||||||
Operating income, as reported | 500 | 546 | ||||||||
Less: Cost reimbursement revenue | (3,773 | ) | (3,736 | ) | ||||||
Add: Reimbursed expenses | 3,835 | 3,696 | ||||||||
Add: Merger-related costs, charges, and other 2 | 34 | 48 | ||||||||
Adjusted operating income ** | 596 | 554 | 8 | % | ||||||
Operating income margin | 10 | % | 11 | % | ||||||
Adjusted operating income margin ** | 48 | % | 47 | % | ||||||
Net income, as reported | 398 | 371 | ||||||||
Less: Cost reimbursement revenue | (3,773 | ) | (3,736 | ) | ||||||
Add: Reimbursed expenses | 3,835 | 3,696 | ||||||||
Add: Merger-related costs, charges, and other 2 | 34 | 48 | ||||||||
Less: Gain on sale of Avendra | (5 | ) | — | |||||||
Income tax effect of above adjustments | (24 | ) | (4 | ) | ||||||
Add: U.S. Tax Cuts and Jobs Act of 2017 | 22 | — | ||||||||
Adjusted net income ** | $ | 487 | $ | 375 | 30 | % | ||||
Diluted EPS, as reported | $ | 1.09 | $ | 0.95 | ||||||
Adjusted Diluted EPS** | $ | 1.34 | $ | 0.96 | 40 | % |
** | Denotes non-GAAP financial measures. Please see pages A-11 and A-12 for information about our reasons for providing these alternative financial measures and the limitations on their use. |
1 | On January 1, 2018, we adopted ASU 2014-09. This column reflects our recast 2017 results under the new accounting standard. |
2 | Merger-related costs, charges, and other includes Starwood merger costs presented in the “Merger-related costs and charges” caption of our Income Statement and purchase accounting revisions. |
North America | Total International | Total Worldwide | ||||||||||
Units | Rooms | Units | Rooms | Units | Rooms | |||||||
Managed | 820 | 249,049 | 1,076 | 286,868 | 1,896 | 535,917 | ||||||
Marriott Hotels | 127 | 67,939 | 166 | 48,287 | 293 | 116,226 | ||||||
Sheraton | 28 | 23,646 | 182 | 62,663 | 210 | 86,309 | ||||||
Sheraton Residences | — | — | 2 | 262 | 2 | 262 | ||||||
Courtyard | 240 | 38,354 | 89 | 19,044 | 329 | 57,398 | ||||||
Westin | 46 | 25,127 | 67 | 21,508 | 113 | 46,635 | ||||||
Westin Residences | 1 | 65 | 1 | 264 | 2 | 329 | ||||||
The Ritz-Carlton | 38 | 10,958 | 56 | 15,166 | 94 | 26,124 | ||||||
The Ritz-Carlton Residences | 35 | 4,554 | 10 | 925 | 45 | 5,479 | ||||||
The Ritz-Carlton Serviced Apartments | — | — | 5 | 697 | 5 | 697 | ||||||
JW Marriott | 16 | 10,059 | 48 | 19,125 | 64 | 29,184 | ||||||
Renaissance | 27 | 11,773 | 52 | 16,653 | 79 | 28,426 | ||||||
Le Méridien | 4 | 720 | 73 | 20,102 | 77 | 20,822 | ||||||
Residence Inn | 108 | 16,519 | 6 | 643 | 114 | 17,162 | ||||||
Four Points | 1 | 134 | 62 | 15,201 | 63 | 15,335 | ||||||
W Hotels | 26 | 7,950 | 23 | 5,571 | 49 | 13,521 | ||||||
W Residences | 9 | 1,078 | 4 | 471 | 13 | 1,549 | ||||||
The Luxury Collection | 6 | 2,294 | 50 | 8,785 | 56 | 11,079 | ||||||
St. Regis | 10 | 1,990 | 31 | 7,043 | 41 | 9,033 | ||||||
St. Regis Residences | 7 | 585 | 6 | 516 | 13 | 1,101 | ||||||
Aloft | 1 | 330 | 33 | 7,842 | 34 | 8,172 | ||||||
Gaylord Hotels | 5 | 8,108 | — | — | 5 | 8,108 | ||||||
Delta Hotels | 25 | 6,764 | — | — | 25 | 6,764 | ||||||
SpringHill Suites | 30 | 4,854 | — | — | 30 | 4,854 | ||||||
Protea Hotels | — | — | 37 | 4,356 | 37 | 4,356 | ||||||
Marriott Executive Apartments | — | — | 29 | 4,270 | 29 | 4,270 | ||||||
Fairfield Inn & Suites | 6 | 1,432 | 19 | 2,715 | 25 | 4,147 | ||||||
Autograph Collection | 4 | 1,204 | 6 | 1,456 | 10 | 2,660 | ||||||
TownePlace Suites | 16 | 1,840 | — | — | 16 | 1,840 | ||||||
EDITION | 2 | 567 | 2 | 699 | 4 | 1,266 | ||||||
EDITION Residences | 1 | 25 | — | — | 1 | 25 | ||||||
Element | 1 | 180 | 5 | 1,085 | 6 | 1,265 | ||||||
Moxy | — | — | 4 | 599 | 4 | 599 | ||||||
Tribute Portfolio | — | — | 3 | 559 | 3 | 559 | ||||||
Bulgari | — | — | 4 | 356 | 4 | 356 | ||||||
Bulgari Residences | — | — | 1 | 5 | 1 | 5 |
North America | Total International | Total Worldwide | ||||||||||
Units | Rooms | Units | Rooms | Units | Rooms | |||||||
Franchised | 3,942 | 572,417 | 466 | 100,217 | 4,408 | 672,634 | ||||||
Courtyard | 743 | 99,006 | 62 | 11,600 | 805 | 110,606 | ||||||
Fairfield Inn & Suites | 904 | 82,628 | 6 | 1,157 | 910 | 83,785 | ||||||
Marriott Hotels | 215 | 66,927 | 50 | 13,838 | 265 | 80,765 | ||||||
Residence Inn | 647 | 76,728 | 4 | 347 | 651 | 77,075 | ||||||
Sheraton | 163 | 48,313 | 62 | 17,768 | 225 | 66,081 | ||||||
SpringHill Suites | 363 | 41,589 | — | — | 363 | 41,589 | ||||||
Westin | 81 | 26,544 | 24 | 7,616 | 105 | 34,160 | ||||||
Westin Residences | 2 | 201 | — | — | 2 | 201 | ||||||
TownePlace Suites | 329 | 33,128 | — | — | 329 | 33,128 | ||||||
Four Points | 143 | 21,877 | 47 | 7,320 | 190 | 29,197 | ||||||
Autograph Collection | 80 | 17,358 | 45 | 10,837 | 125 | 28,195 | ||||||
Renaissance | 58 | 16,594 | 25 | 6,963 | 83 | 23,557 | ||||||
Aloft | 98 | 14,496 | 13 | 2,037 | 111 | 16,533 | ||||||
The Luxury Collection | 11 | 2,683 | 37 | 6,953 | 48 | 9,636 | ||||||
The Luxury Collection Residences | 1 | 91 | 1 | 64 | 2 | 155 | ||||||
Le Méridien | 16 | 3,417 | 15 | 4,022 | 31 | 7,439 | ||||||
Delta Hotels | 26 | 5,984 | 1 | 339 | 27 | 6,323 | ||||||
JW Marriott | 10 | 4,425 | 6 | 1,624 | 16 | 6,049 | ||||||
Tribute Portfolio | 16 | 4,654 | 9 | 975 | 25 | 5,629 | ||||||
Moxy | 6 | 1,347 | 16 | 3,411 | 22 | 4,758 | ||||||
Element | 28 | 3,943 | 2 | 293 | 30 | 4,236 | ||||||
Protea Hotels | — | — | 40 | 2,968 | 40 | 2,968 | ||||||
The Ritz-Carlton | 1 | 429 | — | — | 1 | 429 | ||||||
The Ritz-Carlton Residences | 1 | 55 | — | — | 1 | 55 | ||||||
Bulgari | — | — | 1 | 85 | 1 | 85 | ||||||
Owned/Leased | 30 | 8,241 | 35 | 9,107 | 65 | 17,348 | ||||||
Courtyard | 19 | 2,814 | 3 | 645 | 22 | 3,459 | ||||||
Sheraton | 2 | 1,299 | 5 | 2,126 | 7 | 3,425 | ||||||
Marriott Hotels | 3 | 1,664 | 5 | 1,625 | 8 | 3,289 | ||||||
Protea Hotels | — | — | 9 | 1,415 | 9 | 1,415 | ||||||
Westin | 1 | 1,073 | 1 | 246 | 2 | 1,319 | ||||||
W Hotels | 1 | 509 | 2 | 665 | 3 | 1,174 | ||||||
Renaissance | 1 | 317 | 3 | 749 | 4 | 1,066 | ||||||
The Ritz-Carlton | — | — | 2 | 553 | 2 | 553 | ||||||
JW Marriott | — | — | 1 | 496 | 1 | 496 | ||||||
St. Regis | 1 | 238 | 1 | 160 | 2 | 398 | ||||||
Residence Inn | 1 | 192 | 1 | 140 | 2 | 332 | ||||||
The Luxury Collection | — | — | 2 | 287 | 2 | 287 | ||||||
Tribute Portfolio | 1 | 135 | — | — | 1 | 135 | ||||||
Unconsolidated Joint Ventures | 37 | 6,271 | 96 | 11,772 | 133 | 18,043 | ||||||
AC Hotels by Marriott | 37 | 6,271 | 90 | 11,353 | 127 | 17,624 | ||||||
Autograph Collection | — | — | 6 | 419 | 6 | 419 | ||||||
Timeshare* | 70 | 18,313 | 19 | 3,873 | 89 | 22,186 | ||||||
Marriott Vacations Worldwide | 51 | 11,249 | 15 | 2,406 | 66 | 13,655 | ||||||
Vistana | 19 | 7,064 | 4 | 1,467 | 23 | 8,531 | ||||||
Grand Total | 4,899 | 854,291 | 1,692 | 411,837 | 6,591 | 1,266,128 |
North America | Total International | Total Worldwide | ||||||||||
Total Systemwide | Units | Rooms | Units | Rooms | Units | Rooms | ||||||
Luxury | 176 | 48,490 | 293 | 70,246 | 469 | 118,736 | ||||||
JW Marriott | 26 | 14,484 | 55 | 21,245 | 81 | 35,729 | ||||||
The Ritz-Carlton | 39 | 11,387 | 58 | 15,719 | 97 | 27,106 | ||||||
The Ritz-Carlton Residences | 36 | 4,609 | 10 | 925 | 46 | 5,534 | ||||||
The Ritz-Carlton Serviced Apartments | — | — | 5 | 697 | 5 | 697 | ||||||
The Luxury Collection | 17 | 4,977 | 89 | 16,025 | 106 | 21,002 | ||||||
The Luxury Collection Residences | 1 | 91 | 1 | 64 | 2 | 155 | ||||||
W Hotels | 27 | 8,459 | 25 | 6,236 | 52 | 14,695 | ||||||
W Residences | 9 | 1,078 | 4 | 471 | 13 | 1,549 | ||||||
St. Regis | 11 | 2,228 | 32 | 7,203 | 43 | 9,431 | ||||||
St. Regis Residences | 7 | 585 | 6 | 516 | 13 | 1,101 | ||||||
EDITION | 2 | 567 | 2 | 699 | 4 | 1,266 | ||||||
EDITION Residences | 1 | 25 | — | — | 1 | 25 | ||||||
Bulgari | — | — | 5 | 441 | 5 | 441 | ||||||
Bulgari Residences | — | — | 1 | 5 | 1 | 5 | ||||||
Full Service | 932 | 339,826 | 832 | 243,547 | 1,764 | 583,373 | ||||||
Marriott Hotels | 345 | 136,530 | 221 | 63,750 | 566 | 200,280 | ||||||
Sheraton | 193 | 73,258 | 249 | 82,557 | 442 | 155,815 | ||||||
Sheraton Residences | — | — | 2 | 262 | 2 | 262 | ||||||
Westin | 128 | 52,744 | 92 | 29,370 | 220 | 82,114 | ||||||
Westin Residences | 3 | 266 | 1 | 264 | 4 | 530 | ||||||
Renaissance | 86 | 28,684 | 80 | 24,365 | 166 | 53,049 | ||||||
Autograph Collection | 84 | 18,562 | 57 | 12,712 | 141 | 31,274 | ||||||
Le Méridien | 20 | 4,137 | 88 | 24,124 | 108 | 28,261 | ||||||
Delta Hotels | 51 | 12,748 | 1 | 339 | 52 | 13,087 | ||||||
Gaylord Hotels | 5 | 8,108 | — | — | 5 | 8,108 | ||||||
Marriott Executive Apartments | — | — | 29 | 4,270 | 29 | 4,270 | ||||||
Tribute Portfolio | 17 | 4,789 | 12 | 1,534 | 29 | 6,323 | ||||||
Limited Service | 3,721 | 447,662 | 548 | 94,171 | 4,269 | 541,833 | ||||||
Courtyard | 1,002 | 140,174 | 154 | 31,289 | 1,156 | 171,463 | ||||||
Residence Inn | 756 | 93,439 | 11 | 1,130 | 767 | 94,569 | ||||||
Fairfield Inn & Suites | 910 | 84,060 | 25 | 3,872 | 935 | 87,932 | ||||||
SpringHill Suites | 393 | 46,443 | — | — | 393 | 46,443 | ||||||
Four Points | 144 | 22,011 | 109 | 22,521 | 253 | 44,532 | ||||||
TownePlace Suites | 345 | 34,968 | — | — | 345 | 34,968 | ||||||
Aloft | 99 | 14,826 | 46 | 9,879 | 145 | 24,705 | ||||||
AC Hotels by Marriott | 37 | 6,271 | 90 | 11,353 | 127 | 17,624 | ||||||
Protea Hotels | — | — | 86 | 8,739 | 86 | 8,739 | ||||||
Element | 29 | 4,123 | 7 | 1,378 | 36 | 5,501 | ||||||
Moxy | 6 | 1,347 | 20 | 4,010 | 26 | 5,357 | ||||||
Timeshare* | 70 | 18,313 | 19 | 3,873 | 89 | 22,186 | ||||||
Marriott Vacations Worldwide | 51 | 11,249 | 15 | 2,406 | 66 | 13,655 | ||||||
Vistana | 19 | 7,064 | 4 | 1,467 | 23 | 8,531 | ||||||
Grand Total | 4,899 | 854,291 | 1,692 | 411,837 | 6,591 | 1,266,128 |
Comparable Company-Operated North American Properties | |||||||||||||||||||||
Three Months Ended March 31, 2018 and March 31, 2017 | |||||||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||||||
Brand | 2018 | vs. 2017 | 2018 | vs. 2017 | 2018 | vs. 2017 | |||||||||||||||
JW Marriott | $ | 191.86 | 0.3 | % | 77.7 | % | 0.8 | % | pts. | $ | 246.91 | -0.7 | % | ||||||||
The Ritz-Carlton | $ | 304.39 | 4.8 | % | 75.7 | % | 1.3 | % | pts. | $ | 402.34 | 3.0 | % | ||||||||
W Hotels | $ | 236.66 | 5.3 | % | 80.1 | % | 1.0 | % | pts. | $ | 295.61 | 3.9 | % | ||||||||
Composite North American Luxury 1 | $ | 276.65 | 4.5 | % | 78.3 | % | 1.0 | % | pts. | $ | 353.27 | 3.2 | % | ||||||||
Marriott Hotels | $ | 146.99 | 0.8 | % | 73.6 | % | 0.3 | % | pts. | $ | 199.85 | 0.5 | % | ||||||||
Sheraton | $ | 128.97 | 0.3 | % | 72.6 | % | -1.7 | % | pts. | $ | 177.59 | 2.7 | % | ||||||||
Westin | $ | 147.42 | 0.8 | % | 71.4 | % | -0.1 | % | pts. | $ | 206.52 | 1.0 | % | ||||||||
Composite North American Upper Upscale 2 | $ | 141.21 | 0.6 | % | 72.7 | % | -0.2 | % | pts. | $ | 194.29 | 0.9 | % | ||||||||
North American Full-Service 3 | $ | 164.01 | 1.7 | % | 73.6 | % | 0.0 | % | pts. | $ | 222.76 | 1.7 | % | ||||||||
Courtyard | $ | 97.29 | -0.1 | % | 69.1 | % | 0.0 | % | pts. | $ | 140.90 | 0.0 | % | ||||||||
Residence Inn | $ | 121.02 | -0.4 | % | 76.4 | % | -0.4 | % | pts. | $ | 158.45 | 0.1 | % | ||||||||
Composite North American Limited-Service 4 | $ | 103.68 | 0.5 | % | 71.5 | % | 0.2 | % | pts. | $ | 144.91 | 0.2 | % | ||||||||
North American - All 5 | $ | 145.00 | 1.4 | % | 73.0 | % | 0.1 | % | pts. | $ | 198.70 | 1.3 | % |
Comparable Systemwide North American Properties | |||||||||||||||||||||
Three Months Ended March 31, 2018 and March 31, 2017 | |||||||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||||||
Brand | 2018 | vs. 2017 | 2018 | vs. 2017 | 2018 | vs. 2017 | |||||||||||||||
JW Marriott | $ | 190.01 | 0.6 | % | 77.4 | % | 0.0 | % | pts. | $ | 245.60 | 0.6 | % | ||||||||
The Ritz-Carlton | $ | 304.39 | 4.8 | % | 75.7 | % | 1.3 | % | pts. | $ | 402.34 | 3.0 | % | ||||||||
W Hotels | $ | 236.66 | 5.3 | % | 80.1 | % | 1.0 | % | pts. | $ | 295.61 | 3.9 | % | ||||||||
Composite North American Luxury 1 | $ | 257.96 | 4.3 | % | 77.7 | % | 1.0 | % | pts. | $ | 331.95 | 3.0 | % | ||||||||
Marriott Hotels | $ | 125.14 | 0.6 | % | 69.6 | % | -0.2 | % | pts. | $ | 179.69 | 0.9 | % | ||||||||
Sheraton | $ | 102.37 | 1.5 | % | 67.8 | % | -0.3 | % | pts. | $ | 150.91 | 1.9 | % | ||||||||
Westin | $ | 146.22 | 0.6 | % | 72.0 | % | -0.5 | % | pts. | $ | 203.06 | 1.4 | % | ||||||||
Composite North American Upper Upscale 2 | $ | 125.37 | 1.0 | % | 70.0 | % | -0.3 | % | pts. | $ | 179.11 | 1.4 | % | ||||||||
North American Full-Service 3 | $ | 138.35 | 1.6 | % | 70.8 | % | -0.1 | % | pts. | $ | 195.55 | 1.8 | % | ||||||||
Courtyard | $ | 94.12 | 0.9 | % | 68.9 | % | 0.7 | % | pts. | $ | 136.68 | -0.1 | % | ||||||||
Residence Inn | $ | 109.92 | 2.0 | % | 76.0 | % | 1.1 | % | pts. | $ | 144.72 | 0.5 | % | ||||||||
Fairfield Inn & Suites | $ | 73.10 | 4.2 | % | 66.3 | % | 2.1 | % | pts. | $ | 110.19 | 0.9 | % | ||||||||
Composite North American Limited-Service 4 | $ | 91.42 | 2.5 | % | 70.4 | % | 1.3 | % | pts. | $ | 129.90 | 0.6 | % | ||||||||
North American - All 5 | $ | 111.82 | 2.0 | % | 70.5 | % | 0.7 | % | pts. | $ | 158.52 | 1.1 | % |
1 | Includes JW Marriott, The Ritz-Carlton, W Hotels, The Luxury Collection, St. Regis, and EDITION. |
2 | Includes Marriott Hotels, Sheraton, Westin, Renaissance, Autograph Collection, Delta Hotels, Gaylord Hotels, and Le Méridien. Systemwide also includes Tribute Portfolio. |
3 | Includes Composite North American Luxury and Composite North American Upper Upscale. |
4 | Includes Courtyard, Residence Inn, Fairfield Inn & Suites, SpringHill Suites, Four Points, TownePlace Suites, Four Points, Aloft, Element and AC Hotels by Marriott. Systemwide also includes Moxy. |
5 | Includes North American Full-Service and Composite North American Limited-Service. |
Comparable Company-Operated International Properties | |||||||||||||||||||||
Three Months Ended March 31, 2018 and March 31, 2017 | |||||||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||||||
Region | 2018 | vs. 2017 | 2018 | vs. 2017 | 2018 | vs. 2017 | |||||||||||||||
Greater China | $ | 92.66 | 11.9 | % | 68.7 | % | 5.2 | % | pts. | $ | 134.82 | 3.4 | % | ||||||||
Rest of Asia Pacific | $ | 137.07 | 7.8 | % | 76.5 | % | 1.8 | % | pts. | $ | 179.25 | 5.4 | % | ||||||||
Asia Pacific | $ | 109.20 | 10.0 | % | 71.6 | % | 3.9 | % | pts. | $ | 152.49 | 3.9 | % | ||||||||
Caribbean & Latin America | $ | 160.09 | 10.6 | % | 68.4 | % | 2.9 | % | pts. | $ | 233.91 | 6.0 | % | ||||||||
Europe | $ | 121.72 | 4.1 | % | 65.8 | % | 1.2 | % | pts. | $ | 185.03 | 2.3 | % | ||||||||
Middle East & Africa | $ | 119.38 | 3.4 | % | 69.8 | % | 4.5 | % | pts. | $ | 170.91 | -3.3 | % | ||||||||
International - All 1 | $ | 118.21 | 7.3 | % | 69.7 | % | 3.3 | % | pts. | $ | 169.69 | 2.2 | % | ||||||||
Worldwide 2 | $ | 131.37 | 4.0 | % | 71.3 | % | 1.7 | % | pts. | $ | 184.28 | 1.5 | % |
Comparable Systemwide International Properties | |||||||||||||||||||||
Three Months Ended March 31, 2018 and March 31, 2017 | |||||||||||||||||||||
REVPAR | Occupancy | Average Daily Rate | |||||||||||||||||||
Region | 2018 | vs. 2017 | 2018 | vs. 2017 | 2018 | vs. 2017 | |||||||||||||||
Greater China | $ | 92.17 | 11.5 | % | 68.1 | % | 5.2 | % | pts. | $ | 135.40 | 3.1 | % | ||||||||
Rest of Asia Pacific | $ | 133.07 | 8.8 | % | 75.6 | % | 1.7 | % | pts. | $ | 175.99 | 6.3 | % | ||||||||
Asia Pacific | $ | 110.34 | 10.0 | % | 71.4 | % | 3.6 | % | pts. | $ | 154.49 | 4.4 | % | ||||||||
Caribbean & Latin America | $ | 123.80 | 8.9 | % | 65.8 | % | 2.5 | % | pts. | $ | 188.15 | 4.8 | % | ||||||||
Europe | $ | 104.94 | 5.9 | % | 63.0 | % | 2.4 | % | pts. | $ | 166.60 | 1.8 | % | ||||||||
Middle East & Africa | $ | 114.24 | 3.2 | % | 69.0 | % | 3.8 | % | pts. | $ | 165.57 | -2.4 | % | ||||||||
International - All 1 | $ | 110.90 | 7.5 | % | 67.9 | % | 3.2 | % | pts. | $ | 163.39 | 2.5 | % | ||||||||
Worldwide 2 | $ | 111.55 | 3.6 | % | 69.8 | % | 1.4 | % | pts. | $ | 159.92 | 1.5 | % |
1 | Includes Asia Pacific, Caribbean & Latin America, Europe, and Middle East & Africa. |
2 | Includes North American - All and International - All. |
Fiscal Year 2018 | Fiscal Year 2017 | ||||||
First Quarter | First Quarter | ||||||
Net income, as reported | $ | 398 | $ | 371 | |||
Cost reimbursement revenue | (3,773 | ) | (3,736 | ) | |||
Reimbursed expenses | 3,835 | 3,696 | |||||
Interest expense | 75 | 70 | |||||
Interest expense from unconsolidated joint ventures | 2 | 1 | |||||
Tax provision | 104 | 123 | |||||
Depreciation and amortization | 54 | 51 | |||||
Contract investment amortization | 18 | 11 | |||||
Depreciation classified in reimbursed expenses | 33 | 32 | |||||
Depreciation and amortization from unconsolidated joint ventures | 10 | 11 | |||||
Share-based compensation | 38 | 35 | |||||
Gain on asset dispositions | (58 | ) | — | ||||
Merger-related costs and charges | 34 | 51 | |||||
Adjusted EBITDA ** | $ | 770 | $ | 716 | |||
Increase over 2017 Adjusted EBITDA ** | 8 | % |
** | Denotes non-GAAP financial measures. Please see pages A-11 and A-12 for information about our reasons for providing these alternative financial measures and the limitations on their use. |
Range | |||||||||||
Estimated Second Quarter 2018 | Second Quarter 2017 2** | ||||||||||
Net income, excluding certain items 1 | $ | 480 | $ | 487 | |||||||
Interest expense | 85 | 85 | |||||||||
Interest expense from unconsolidated joint ventures | — | — | |||||||||
Tax provision | 155 | 158 | |||||||||
Depreciation and amortization | 55 | 55 | |||||||||
Contract investment amortization | 15 | 15 | |||||||||
Depreciation classified in reimbursed expenses | 35 | 35 | |||||||||
Depreciation and amortization from unconsolidated joint ventures | 10 | 10 | |||||||||
Share-based compensation | 45 | 45 | |||||||||
Adjusted EBITDA ** | $ | 880 | $ | 890 | $ | 820 | |||||
Increase over 2017 Adjusted EBITDA** | 7 | % | 9 | % |
1 | Guidance excludes cost reimbursement revenue, reimbursed expenses, and merger-related costs and charges, which the company cannot accurately forecast and which may be significant, except for depreciation classified in reimbursed expenses, which is included in the caption “Depreciation classified in reimbursed expenses” above. |
2 | We have not completed our recast of 2017 second quarter results under ASU 2014-09, but we estimate that the application of ASU 2014-09 will lower previously reported 2017 second quarter Adjusted EBITDA of $834 million by $14 million, resulting in estimated 2017 second quarter Adjusted EBITDA of $820 million. |
Range | |||||||||||
Estimated Full Year 2018 | Full Year 2017 2** | ||||||||||
Net income, excluding certain items 1 | $ | 1,923 | $ | 1,965 | |||||||
Interest expense | 335 | 335 | |||||||||
Interest expense from unconsolidated joint ventures | 10 | 10 | |||||||||
Tax provision | 595 | 608 | |||||||||
Depreciation and amortization | 225 | 225 | |||||||||
Contract investment amortization | 60 | 60 | |||||||||
Depreciation classified in reimbursed expenses | 145 | 145 | |||||||||
Depreciation and amortization from unconsolidated joint ventures | 40 | 40 | |||||||||
Share-based compensation | 170 | 170 | |||||||||
Gain on asset dispositions | (58 | ) | (58 | ) | |||||||
Adjusted EBITDA ** | $ | 3,445 | $ | 3,500 | $ | 3,131 | |||||
Increase over 2017 Adjusted EBITDA** | 10 | % | 12 | % |
1 | Guidance excludes cost reimbursement revenue, reimbursed expenses, and merger-related costs and charges, which the company cannot accurately forecast and which may be significant, except for depreciation classified in reimbursed expenses, which is included in the caption “Depreciation classified in reimbursed expenses” above. |
2 | We have not completed our recast of 2017 full year results under ASU 2014-09, but we estimate that the application of ASU 2014-09 will lower previously reported 2017 full year Adjusted EBITDA of $3,223 million by $92 million, resulting in estimated 2017 full year Adjusted EBITDA of $3,131 million. |
B:!_T3/Q/_ .!5E_\ 'J/J.*_Y]O[F'UFA_.OO/MNBOB,_\%1O#X_Y
MIGXH_P# JR_^/4G_ ]'\/\ _1,_%'_@59?_ !ZCZCBO^? 4/;\J/*'M^5/HHYT180* .@I
M<#TH.!1D'I1S(#VKP'\ =)\5> K'Q+J'B%M*CG\S>'1!''ME:,?,Q'7:/Q-:
M?_#/O@S_ **#;?\ ?R'_ .+J]_S9_P#Y_P"@A7SKQ[UIHCE2E)O7J>R^+O@M
MX5\/^&=0U&S\:6^H75O$7CME>(F0YZ<,37D%A:B\OK:W)VB618RP'3) J'CW
MJ[HA UK3_P#KXC_]"%)FB32U.Y^,OPHMOA=,-2TG3M035K*U=5CO$*D2@H"2-I(ZDC@]JYIY
M2,8.:0R^@K6*:W9:@XZMGMOP4^ NF_%+PMJFLZAKLFCQV-P8G(C4H$"*Y=F8
MC &3^5='_P ,]_#,_P#-6M+_ / JV_\ CE:_[-+9^ ?Q#/3_ (^O_205\I>:
M/6I5Y-ZF2YI-V9].P?LG^'?$T$O_ C'Q%L=4N47.R-8YE_$QR$J/?!KY^\:
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MY(..#P:\N+<@9Y/:OK2-YQ^PY<-X@+OI7TU\+6&I?LO>
M*H+7F>);P.J]21&KX_%37RYD^IKVS]F7XG67A+6KW0-:D2/2=7VA99?N1RX(
MPV>BL#@GU"]LFJ3.7$4[PNNAXR+C'_ZJ3SAGI7KGQ3_9T\0^%-9N9]"L)]9T
M.5B\#6BF26)3SL=!SQ_> ((]#Q74^!/@3H'Q#\#PVLFG:YX;\46L9\V^O+61
M8)V+$C ;Y6 ! P"K<9YJ;$N=-14KZ&Q^S)(;;X4^-+V;Y;17DY;I\L&6_0BO
MF'SR>M?4/Q;N;7X'_!FS\$Z:9)KW4U9)KSRRJL" !T&,]#CY&:0R2%BQ9V
M.2>Y-4.E%2G.2VT/I+]C[P>;S6-6\3SQYBM$^QVY(ZR-@N1[A<#_ ('6+XO_
M &?/B3XN\3ZGK-Q86@EO9WF*F\3Y03\J_@,#\*[#QS=S? []G31]&M)I+'7M
M49?,DB8I*CM^\F8$<_*-L>?<5\ZGXE^+C_S-.M#_ +B,W_Q54E>OY5])?L
MJ?$W4-7\3ZIX;U_4;G5(]0M_,MS?3M-ADSN0;B>&0DG_ '*\2^*G@QOA_P"/
MM8T0@B&"8M;LW\4+?,A]_E(!]P:I::%4DX2=.7J>U_L5MNU[Q.,Y_P!&A_\
M0FIVH_'+X4P:E