- First quarter 2023 comparable systemwide constant dollar RevPAR increased 34.3 percent worldwide, 25.6 percent in the U.S. & Canada, and 63.1 percent in international markets, compared to the 2022 first quarter;
- First quarter reported diluted EPS totaled $2.43, compared to reported diluted EPS of $1.14 in the year-ago quarter. First quarter adjusted diluted EPS totaled $2.09, compared to first quarter 2022 adjusted diluted EPS of $1.25;
- First quarter reported net income totaled $757 million, compared to reported net income of $377 million in the year-ago quarter. First quarter adjusted net income totaled $648 million, compared to first quarter 2022 adjusted net income of $413 million;
- Adjusted EBITDA totaled $1,098 million in the 2023 first quarter, compared to first quarter 2022 adjusted EBITDA of $759 million;
- The company added approximately 11,000 rooms globally during the first quarter, including roughly 5,800 rooms in international markets and more than 2,700 conversion rooms;
- At the end of the quarter, Marriott's worldwide development pipeline totaled more than 3,050 properties and approximately 502,000 rooms, including more than 21,000 rooms approved, but not yet subject to signed contracts. Roughly 200,000 rooms in the pipeline were under construction as of the end of the first quarter;
- Marriott repurchased 6.8 million shares of common stock for $1.1 billion during the first quarter. Year to date through April 28, the company has returned $1.5 billion to shareholders through dividends and share repurchases.
Marriott International, Inc. (NASDAQ: MAR) today reported first quarter 2023 results.
Anthony Capuano, President and Chief Executive Officer, said, "We are off to a great start in 2023. First quarter worldwide RevPAR1 grew 34 percent year over year, with meaningful gains in both occupancy and average daily rate. International markets were particularly robust, with RevPAR growth of 63 percent. The lifting of travel restrictions throughout Asia Pacific, particularly in Greater China, significantly boosted first quarter demand in the region.
"In the U.S. & Canada, we saw solid demand across the leisure and group segments in the quarter, while business transient demand continued to improve. ADR in the region rose 10 percent year over year, aided by higher special corporate negotiated rates and 15 percent growth in group ADR.
"Our industry-leading pipeline grew to approximately 502,000 rooms, up 2.6 percent from the year-ago quarter end. Conversion activity remained healthy, accounting for 29 percent of rooms signed and 25 percent of rooms opened in the quarter. We still expect net rooms growth of 4 to 4.5 percent for full year 2023.
"We were thrilled to welcome City Express to our lineup as our 31st brand yesterday, further broadening our brand portfolio into the midscale space. With roughly 17,000 rooms joining our system, we are now the largest hotel company in the Caribbean & Latin America region. Demand for the mid-scale segment is growing rapidly, and we see meaningful opportunity to both expand the brand further in CALA and introduce it in other regions.
"While the global economic picture is uncertain, demand remains strong, and we are not seeing signs of a slowdown. With the faster than expected recovery in international markets and continued solid booking trends globally to date in the second quarter, we are raising our RevPAR guidance for the full year. We believe our broad portfolio of brands, award-winning Marriott Bonvoy loyalty program, dedicated associates, and efficient asset-light business model position us very well for future growth."
First Quarter 2023 Results
Marriott's reported operating income totaled $951 million in the 2023 first quarter, compared to 2022 first quarter reported operating income of $558 million. Reported net income totaled $757 million in the 2023 first quarter, compared to 2022 first quarter reported net income of $377 million. Reported diluted earnings per share (EPS) totaled $2.43 in the quarter, compared to reported diluted EPS of $1.14 in the year-ago quarter.
Adjusted operating income in the 2023 first quarter totaled $941 million, compared to 2022 first quarter adjusted operating income of $605 million. First quarter 2023 adjusted net income totaled $648 million, compared to 2022 first quarter adjusted net income of $413 million. Adjusted diluted EPS in the 2023 first quarter totaled $2.09, compared to adjusted diluted EPS of $1.25 in the year-ago quarter. The 2023 first quarter adjusted results excluded a special tax item of $100 million ($0.32 per share). The 2022 first quarter adjusted results excluded $11 million after-tax ($0.03 per share) of impairment charges and a $6 million after-tax ($0.02 per share) gain on an investee's property sale.
Adjusted results also excluded cost reimbursement revenue, reimbursed expenses and merger-related charges and other expenses. See pages A-2 and A-8 for the calculation of adjusted results and the manner in which the adjusted measures are determined in this press release.
Base management and franchise fees totaled $932 million in the 2023 first quarter, a 31 percent increase compared to base management and franchise fees of $713 million in the year-ago quarter. The increase is primarily attributable to RevPAR increases and unit growth. Other non-RevPAR related franchise fees in the 2023 first quarter totaled $197 million, a 16 percent increase compared to $170 million in the year-ago quarter, largely driven by higher co-branded credit card and residential branding fees.
Incentive management fees totaled $201 million in the 2023 first quarter, a 97 percent increase compared to $102 million in the 2022 first quarter. Managed hotels in international markets contributed 57 percent of the fees earned in the quarter.
Owned, leased, and other revenue, net of direct expenses, totaled $75 million in the 2023 first quarter, compared to $65 million in the year-ago quarter. The year-over-year change largely reflects improved performance at owned and leased hotels, partially offset by the $33 million of government subsidies received in the year ago quarter.
General, administrative, and other expenses for the 2023 first quarter totaled $202 million, a 3 percent decrease compared to $208 million in the year-ago quarter.
Interest expense, net, totaled $111 million in the 2023 first quarter, compared to $88 million in the year-ago quarter. The increase was largely due to higher interest expense associated with higher debt balances.
In the 2023 first quarter, the provision for income taxes totaled $87 million, a 10 percent effective rate, compared to $99 million, a 21 percent effective rate, in the year ago quarter. The 2023 first quarter provision included a $103 million benefit primarily from the release of reserves due to the completion of a prior year tax audit.
Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) totaled $1,098 million in the 2023 first quarter, compared to first quarter 2022 adjusted EBITDA of $759 million. See page A-8 for the adjusted EBITDA calculation.
Selected Performance Information
The company added 79 properties (11,015 rooms) to its worldwide lodging portfolio during the 2023 first quarter, including more than 2,700 rooms converted from competitor brands and roughly 5,800 rooms in international markets. Fourteen properties (2,351 rooms) exited the system during the quarter. At the end of the quarter, Marriott's global lodging system totaled nearly 8,400 properties, with over 1,534,000 rooms.
At the end of the quarter, the company's worldwide development pipeline totaled 3,060 properties with approximately 502,000 rooms, including 1,018 properties with roughly 200,000 rooms under construction, or 40 percent of the pipeline, and 127 properties with more than 21,000 rooms approved for development, but not yet subject to signed contracts.
In the 2023 first quarter, worldwide RevPAR increased 34.3 percent (a 32.6 percent increase using actual dollars) compared to the 2022 first quarter. RevPAR in the U.S. & Canada increased 25.6 percent (a 25.4 percent increase using actual dollars), and RevPAR in international markets increased 63.1 percent (a 55.1 percent increase using actual dollars).
Balance Sheet & Common Stock
At the end of the quarter, Marriott's total debt was $10.7 billion and cash and equivalents totaled $0.6 billion, compared to $10.1 billion in debt and $0.5 billion of cash and equivalents at year-end 2022.
In the first quarter, the company issued $800 million of Series KK Senior Notes due in 2029 with a 4.9 percent interest rate coupon.
Year to date through April 28, the company has repurchased 8.2 million shares for $1.4 billion.
Company Outlook
The company is raising its guidance for full year 2023. One month into the second quarter, global booking trends remain robust.
Given short-term booking windows and a high level of macroeconomic uncertainty, there is less visibility in forecasting the company's financial performance for the second half of 2023.
| Second Quarter 2023 vs Second Quarter 2022 | Full Year 2023 vs Full Year 2022 | ||
| Comparable systemwide constant $ RevPAR growth | |||
| Worldwide | 10% to 12% | 10% to 13% | |
| U.S. & Canada | 5% to 7% | 6% to 9% | |
| International | 27% to 29% | 22% to 25% | |
| Year-End 2023 vs Year-End 2022 | |||
| Gross Rooms Growth | Approx. 5.5% | ||
| Deletions | 1% to 1.5% | ||
| Net rooms growth | 4% to 4.5% | ||
| ($ in millions, except EPS) | Second Quarter 2023 | Full Year 2023 | |
| Gross fee revenues | $1,205 to $1,225 | $4,600 to $4,750 | |
| Owned, leased, and other revenue, net of direct expenses | Approx. $80 | $300 to $310 | |
| General, administrative, and other expenses | $250 to $245 | $935 to $915 | |
| Adjusted EBITDA1,2 | $1,140 to $1,165 | $4,360 to $4,540 | |
| Adjusted EPS – diluted2,3 | $2.09 to $2.15 | $7.97 to $8.42 | |
| Investment Spending4 | $850 to $1,000 | ||
| Capital Return to Shareholders5 | $3,600 to $4,100 | ||
| 1See pages A-9 and A-10 for the adjusted EBITDA calculations. |
| 2Adjusted EBITDA and Adjusted EPS – diluted for second quarter and full year 2023 do not include cost reimbursement revenue, reimbursed expenses, merger-related charges and other expenses, special tax items, or any asset sales that may occur during the year, each of which the company cannot forecast with sufficient accuracy and without unreasonable efforts, and which may be significant. Adjusted EPS – diluted for full year 2023 excludes a special tax item of $100 million reported in the first quarter of 2023. See page A-2 for the Adjusted EPS – diluted calculation for the first quarter of 2023. |
| 3Assumes the level of capital return to shareholders noted above. |
| 4Investment spending includes capital and technology expenditures, loan advances, contract acquisition costs, and other investing activities. |
| 5 Assumes the level of investment spending noted above and that no asset sales occur during the remainder of the year. |
| 1 | All occupancy, Average Daily Rate (ADR) and RevPAR statistics and estimates are systemwide constant dollar. Unless otherwise stated, all changes refer to year-over-year changes for the comparable period. Occupancy, ADR and RevPAR comparisons between 2023 and 2022 reflect properties that are comparable in both years. |
| MARRIOTT INTERNATIONAL, INC. | |||||||||||||||
| PRESS RELEASE SCHEDULES | |||||||||||||||
| TABLE OF CONTENTS | |||||||||||||||
| QUARTER 1, 2023 | |||||||||||||||
| Consolidated Statements of Income - As Reported | A-1 | ||||||||||||||
| Non-GAAP Financial Measures | A-2 | ||||||||||||||
| Total Lodging Products by Ownership Type | A-3 | ||||||||||||||
| Total Lodging Products by Tier | A-5 | ||||||||||||||
| Key Lodging Statistics | A-6 | ||||||||||||||
| Adjusted EBITDA | A-8 | ||||||||||||||
| Adjusted EBITDA Forecast - Second Quarter 2023 | A-9 | ||||||||||||||
| Adjusted EBITDA Forecast - Full Year 2023 | A-10 | ||||||||||||||
| Explanation of Non-GAAP Financial and Performance Measures | A-11 | ||||||||||||||
| MARRIOTT INTERNATIONAL, INC. | |||||||
| CONSOLIDATED STATEMENTS OF INCOME - AS REPORTED | |||||||
| FIRST QUARTER 2023 AND 2022 | |||||||
| (in millions except per share amounts, unaudited) | |||||||
| As Reported | As Reported | Percent | |||||
| Three Months Ended | Three Months Ended | Better/(Worse) | |||||
| March 31, 2023 | March 31, 2022 | Reported 2023 vs. 2022 | |||||
| REVENUES | |||||||
| Base management fees | $ 293 | $ 213 | 38 | ||||
| Franchise fees 1 | 639 | 500 | 28 | ||||
| Incentive management fees | 201 | 102 | 97 | ||||
| Gross Fee Revenues | 1,133 | 815 | 39 | ||||
| Contract investment amortization 2 | (21) | (24) | 13 | ||||
| Net Fee Revenues | 1,112 | 791 | 41 | ||||
| Owned, leased, and other revenue 3 | 356 | 262 | 36 | ||||
| Cost reimbursement revenue 4 | 4,147 | 3,146 | 32 | ||||
| Total Revenues | 5,615 | 4,199 | 34 | ||||
| OPERATING COSTS AND EXPENSES | |||||||
| Owned, leased, and other - direct 5 | 281 | 197 | (43) | ||||
| Depreciation, amortization, and other 6 | 44 | 48 | 8 | ||||
| General, administrative, and other 7 | 202 | 208 | 3 | ||||
| Merger-related charges and other | 1 | 9 | 89 | ||||
| Reimbursed expenses 4 | 4,136 | 3,179 | (30) | ||||
| Total Expenses | 4,664 | 3,641 | (28) | ||||
| OPERATING INCOME | 951 | 558 | 70 | ||||
| Gains and other income, net 8 | 3 | 4 | (25) | ||||
| Interest expense | (126) | (93) | (35) | ||||
| Interest income | 15 | 5 | 200 | ||||
| Equity in earnings 9 | 1 | 2 | (50) | ||||
| INCOME BEFORE INCOME TAXES | 844 | 476 | 77 | ||||
| Provision for income taxes | (87) | (99) | 12 | ||||
| NET INCOME | $ 757 | $ 377 | 101 | ||||
| EARNINGS PER SHARE | |||||||
| Earnings per share - basic | $ 2.44 | $ 1.15 | 112 | ||||
| Earnings per share - diluted | $ 2.43 | $ 1.14 | 113 | ||||
| Basic Shares | 309.6 | 328.3 | |||||
| Diluted Shares | 311.0 | 330.0 | |||||
| 1 | Franchise fees include fees from our franchise agreements, application and relicensing fees, timeshare and yacht fees, co-branded credit card fees, and | ||||||
| residential branding fees. | |||||||
| 2 | Contract investment amortization includes amortization of capitalized costs 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 of joint venture interests and other investments, and adjustments from | ||||||
| other equity investments. | |||||||
| 9 | Equity in earnings include our equity in earnings or losses of unconsolidated equity method investments. | ||||||
| MARRIOTT INTERNATIONAL, INC. | |||||||
| NON-GAAP FINANCIAL MEASURES | |||||||
| ($ in millions except per share amounts) | |||||||
| The following table presents our reconciliations of Adjusted operating income, Adjusted operating income margin, Adjusted | |||||||
| net income, and Adjusted diluted earnings per share, to the most directly comparable GAAP measure. Adjusted total | |||||||
| revenues is used in the determination of Adjusted operating income margin. | |||||||
| Three Months Ended | |||||||
| Percent | |||||||
| March 31, | March 31, | Better/ | |||||
| 2023 | 2022 | (Worse) | |||||
| Total revenues, as reported | $ 5,615 | $ 4,199 | |||||
| Less: Cost reimbursement revenue | (4,147) | (3,146) | |||||
| Add: Impairments 1 | - | 5 | |||||
| Adjusted total revenues ** | 1,468 | 1,058 | |||||
| Operating income, as reported | 951 | 558 | |||||
| Less: Cost reimbursement revenue | (4,147) | (3,146) | |||||
| Add: Reimbursed expenses | 4,136 | 3,179 | |||||
| Add: Merger-related charges and other | 1 | 9 | |||||
| Add: Impairments 1 | - | 5 | |||||
| Adjusted operating income ** | 941 | 605 | 56 % | ||||
| Operating income margin | 17 % | 13 % | |||||
| Adjusted operating income margin ** | 64 % | 57 % | |||||
| Net income, as reported | 757 | 377 | |||||
| Less: Cost reimbursement revenue | (4,147) | (3,146) | |||||
| Add: Reimbursed expenses | 4,136 | 3,179 | |||||
| Add: Merger-related charges and other | 1 | 9 | |||||
| Add: Impairments 2 | - | 11 | |||||
| Less: Gain on investee's property sale 3 | - | (8) | |||||
| Income tax effect of above adjustments | 1 | (9) | |||||
| Less: Income tax special items | (100) | - | |||||
| Adjusted net income ** | $ 648 | $ 413 | 57 % | ||||
| Diluted earnings per share, as reported | $ 2.43 | $ 1.14 | |||||
| Adjusted diluted earnings per share** | $ 2.09 | $ 1.25 | 67 % | ||||
| ** | 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 | Three months ended March 31, 2022 includes impairment charges reported in Contract investment amortization of | ||||||
| $5 million. | |||||||
| 2 | Three months ended March 31, 2022 includes impairment charges reported in Contract investment amortization of | ||||||
| $5 million and Equity in earnings of $6 million. | |||||||
| 3 | Gain on investee's property sale reported in Equity in earnings. | ||||||
| MARRIOTT INTERNATIONAL, INC. | ||||||
| TOTAL LODGING PRODUCTS BY OWNERSHIP TYPE | ||||||
| As of March 31, 2023 | ||||||
| US & Canada | Total International | Total Worldwide | ||||
| Properties | Rooms | Properties | Rooms | Properties | Rooms | |
| Managed | 627 | 214,699 | 1,366 | 346,498 | 1,993 | 561,197 |
| Marriott Hotels | 103 | 57,233 | 169 | 52,551 | 272 | 109,784 |
| Sheraton | 25 | 20,383 | 183 | 61,867 | 208 | 82,250 |
| Courtyard | 167 | 27,077 | 114 | 24,446 | 281 | 51,523 |
| Westin | 40 | 21,865 | 79 | 24,498 | 119 | 46,363 |
| JW Marriott | 21 | 12,724 | 71 | 25,108 | 92 | 37,832 |
| The Ritz-Carlton | 40 | 12,076 | 73 | 17,572 | 113 | 29,648 |
| Renaissance | 24 | 10,607 | 54 | 17,327 | 78 | 27,934 |
| Four Points | 1 | 134 | 84 | 23,216 | 85 | 23,350 |
| Le Méridien | 1 | 100 | 73 | 20,355 | 74 | 20,455 |
| W Hotels | 23 | 6,516 | 39 | 10,406 | 62 | 16,922 |
| Residence Inn | 73 | 11,857 | 9 | 1,116 | 82 | 12,973 |
| St. Regis | 10 | 1,977 | 43 | 9,780 | 53 | 11,757 |
| Delta Hotels by Marriott | 25 | 6,770 | 27 | 4,956 | 52 | 11,726 |
| The Luxury Collection | 6 | 2,296 | 46 | 8,064 | 52 | 10,360 |
| Gaylord Hotels | 6 | 10,220 | - | - | 6 | 10,220 |
| Aloft | 2 | 505 | 43 | 9,431 | 45 | 9,936 |
| Fairfield by Marriott | 6 | 1,431 | 66 | 8,263 | 72 | 9,694 |
| AC Hotels by Marriott | 7 | 1,165 | 68 | 8,466 | 75 | 9,631 |
| Autograph Collection | 8 | 2,508 | 23 | 3,514 | 31 | 6,022 |
| Marriott Executive Apartments | - | - | 35 | 5,030 | 35 | 5,030 |
| SpringHill Suites | 25 | 4,241 | - | - | 25 | 4,241 |
| EDITION | 5 | 1,379 | 10 | 2,216 | 15 | 3,595 |
| Element | 3 | 810 | 13 | 2,551 | 16 | 3,361 |
| Protea Hotels | - | - | 25 | 3,081 | 25 | 3,081 |
| Tribute Portfolio | - | - | 8 | 1,150 | 8 | 1,150 |
| Moxy | - | - | 6 | 1,092 | 6 | 1,092 |
| TownePlace Suites | 6 | 825 | - | - | 6 | 825 |
| Bulgari | - | - | 5 | 442 | 5 | 442 |
| Franchised | 5,172 | 742,406 | 926 | 181,819 | 6,098 | 924,225 |
| Courtyard | 880 | 117,564 | 115 | 21,389 | 995 | 138,953 |
| Fairfield by Marriott | 1,137 | 106,880 | 48 | 8,510 | 1,185 | 115,390 |
| Residence Inn | 780 | 93,055 | 26 | 3,482 | 806 | 96,537 |
| Marriott Hotels | 234 | 74,506 | 63 | 18,167 | 297 | 92,673 |
| Sheraton | 147 | 46,348 | 72 | 20,857 | 219 | 67,205 |
| SpringHill Suites | 510 | 59,116 | - | - | 510 | 59,116 |
| Autograph Collection | 138 | 27,170 | 110 | 23,955 | 248 | 51,125 |
| TownePlace Suites | 486 | 49,296 | - | - | 486 | 49,296 |
| Westin | 91 | 30,818 | 27 | 7,858 | 118 | 38,676 |
| Four Points | 158 | 23,922 | 63 | 10,604 | 221 | 34,526 |
| Aloft | 157 | 22,453 | 22 | 3,607 | 179 | 26,060 |
| AC Hotels by Marriott | 104 | 17,187 | 47 | 8,388 | 151 | 25,575 |
| Renaissance | 64 | 18,074 | 29 | 7,487 | 93 | 25,561 |
| Moxy | 29 | 5,532 | 89 | 16,831 | 118 | 22,363 |
| Delta Hotels by Marriott | 63 | 14,272 | 11 | 2,557 | 74 | 16,829 |
| The Luxury Collection | 11 | 3,112 | 53 | 9,672 | 64 | 12,784 |
| Tribute Portfolio | 55 | 8,754 | 30 | 3,508 | 85 | 12,262 |
| Element | 80 | 10,712 | 2 | 269 | 82 | 10,981 |
| Le Méridien | 25 | 5,749 | 18 | 4,636 | 43 | 10,385 |
| JW Marriott | 12 | 6,072 | 11 | 2,714 | 23 | 8,786 |
| Design Hotels | 10 | 1,385 | 50 | 4,074 | 60 | 5,459 |
| Protea Hotels | - | - | 35 | 2,705 | 35 | 2,705 |
| The Ritz-Carlton | 1 | 429 | - | - | 1 | 429 |
| W Hotels | - | - | 1 | 246 | 1 | 246 |
| Bulgari | - | - | 2 | 161 | 2 | 161 |
| Marriott Executive Apartments | - | - | 2 | 142 | 2 | 142 |
| MARRIOTT INTERNATIONAL, INC. | ||||||
| TOTAL LODGING PRODUCTS BY OWNERSHIP TYPE | ||||||
| As of March 31, 2023 | ||||||
| US & Canada | Total International | Total Worldwide | ||||
| Properties | Rooms | Properties | Rooms | Properties | Rooms | |
| Owned/Leased | 14 | 4,656 | 38 | 9,209 | 52 | 13,865 |
| Marriott Hotels | 2 | 1,308 | 6 | 2,064 | 8 | 3,372 |
| Courtyard | 7 | 987 | 4 | 894 | 11 | 1,881 |
| Sheraton | - | - | 4 | 1,830 | 4 | 1,830 |
| W Hotels | 2 | 779 | 2 | 665 | 4 | 1,444 |
| Westin | 1 | 1,073 | - | - | 1 | 1,073 |
| Protea Hotels | - | - | 5 | 912 | 5 | 912 |
| Renaissance | 1 | 317 | 2 | 505 | 3 | 822 |
| The Ritz-Carlton | - | - | 2 | 550 | 2 | 550 |
| JW Marriott | - | - | 1 | 496 | 1 | 496 |
| The Luxury Collection | - | - | 3 | 383 | 3 | 383 |
| Autograph Collection | - | - | 5 | 361 | 5 | 361 |
| Residence Inn | 1 | 192 | 1 | 140 | 2 | 332 |
| Tribute Portfolio | - | - | 2 | 249 | 2 | 249 |
| St. Regis | - | - | 1 | 160 | 1 | 160 |
| Residences | 67 | 7,158 | 49 | 4,733 | 116 | 11,891 |
| The Ritz-Carlton Residences | 40 | 4,426 | 16 | 1,443 | 56 | 5,869 |
| St. Regis Residences | 10 | 1,196 | 12 | 1,562 | 22 | 2,758 |
| W Residences | 10 | 1,089 | 7 | 547 | 17 | 1,636 |
| Bulgari Residences | - | - | 5 | 514 | 5 | 514 |
| Sheraton Residences | - | - | 2 | 282 | 2 | 282 |
| Westin Residences | 3 | 266 | 1 | 9 | 4 | 275 |
| Marriott Hotels Residences | - | - | 2 | 246 | 2 | 246 |
| The Luxury Collection Residences | 1 | 91 | 3 | 115 | 4 | 206 |
| EDITION Residences | 3 | 90 | - | - | 3 | 90 |
| Le Méridien Residences | - | - | 1 | 15 | 1 | 15 |
| Timeshare* | 72 | 18,839 | 21 | 3,906 | 93 | 22,745 |
| Yacht* | - | - | 1 | 149 | 1 | 149 |
| Grand Total | 5,952 | 987,758 | 2,401 | 546,314 | 8,353 | 1,534,072 |
| *Timeshare and Yacht counts are included in this table by geographical location. For external reporting purposes, these offerings are captured within "Unallocated corporate and other." | ||||||
| In the above table, The Luxury Collection, Autograph Collection and Tribute Portfolio include seven total properties that we acquired when we purchased Elegant Hotels Group plc in December 2019 which we currently intend to re-brand under such brands after the completion of planned renovations. |
| MARRIOTT INTERNATIONAL, INC. | ||||||
| TOTAL LODGING PRODUCTS BY TIER | ||||||
| As of March 31, 2023 | ||||||
| US & Canada | Total International | Total Worldwide | ||||
| Total Systemwide | Properties | Rooms | Properties | Rooms | Properties | Rooms |
| Luxury | 195 | 54,252 | 406 | 92,816 | 601 | 147,068 |
| JW Marriott | 33 | 18,796 | 83 | 28,318 | 116 | 47,114 |
| The Ritz-Carlton | 41 | 12,505 | 75 | 18,122 | 116 | 30,627 |
| The Ritz-Carlton Residences | 40 | 4,426 | 16 | 1,443 | 56 | 5,869 |
| The Luxury Collection | 17 | 5,408 | 102 | 18,119 | 119 | 23,527 |
| The Luxury Collection Residences | 1 | 91 | 3 | 115 | 4 | 206 |
| W Hotels | 25 | 7,295 | 42 | 11,317 | 67 | 18,612 |
| W Residences | 10 | 1,089 | 7 | 547 | 17 | 1,636 |
| St. Regis | 10 | 1,977 | 44 | 9,940 | 54 | 11,917 |
| St. Regis Residences | 10 | 1,196 | 12 | 1,562 | 22 | 2,758 |
| EDITION | 5 | 1,379 | 10 | 2,216 | 15 | 3,595 |
| EDITION Residences | 3 | 90 | - | - | 3 | 90 |
| Bulgari | - | - | 7 | 603 | 7 | 603 |
| Bulgari Residences | - | - | 5 | 514 | 5 | 514 |
| Premium | 1,066 | 359,726 | 1,088 | 290,050 | 2,154 | 649,776 |
| Marriott Hotels | 339 | 133,047 | 238 | 72,782 | 577 | 205,829 |
| Marriott Hotels Residences | - | - | 2 | 246 | 2 | 246 |
| Sheraton | 172 | 66,731 | 259 | 84,554 | 431 | 151,285 |
| Sheraton Residences | - | - | 2 | 282 | 2 | 282 |
| Westin | 132 | 53,756 | 106 | 32,356 | 238 | 86,112 |
| Westin Residences | 3 | 266 | 1 | 9 | 4 | 275 |
| Autograph Collection | 146 | 29,678 | 138 | 27,830 | 284 | 57,508 |
| Renaissance | 89 | 28,998 | 85 | 25,319 | 174 | 54,317 |
| Le Méridien | 26 | 5,849 | 91 | 24,991 | 117 | 30,840 |
| Le Méridien Residences | - | - | 1 | 15 | 1 | 15 |
| Delta Hotels by Marriott | 88 | 21,042 | 38 | 7,513 | 126 | 28,555 |
| Tribute Portfolio | 55 | 8,754 | 40 | 4,907 | 95 | 13,661 |
| Gaylord Hotels | 6 | 10,220 | - | - | 6 | 10,220 |
| Design Hotels | 10 | 1,385 | 50 | 4,074 | 60 | 5,459 |
| Marriott Executive Apartments | - | - | 37 | 5,172 | 37 | 5,172 |
| Select | 4,619 | 554,941 | 885 | 159,393 | 5,504 | 714,334 |
| Courtyard | 1,054 | 145,628 | 233 | 46,729 | 1,287 | 192,357 |
| Fairfield by Marriott | 1,143 | 108,311 | 114 | 16,773 | 1,257 | 125,084 |
| Residence Inn | 854 | 105,104 | 36 | 4,738 | 890 | 109,842 |
| SpringHill Suites | 535 | 63,357 | - | - | 535 | 63,357 |
| Four Points | 159 | 24,056 | 147 | 33,820 | 306 | 57,876 |
| TownePlace Suites | 492 | 50,121 | - | - | 492 | 50,121 |
| Aloft | 159 | 22,958 | 65 | 13,038 | 224 | 35,996 |
| AC Hotels by Marriott | 111 | 18,352 | 115 | 16,854 | 226 | 35,206 |
| Moxy | 29 | 5,532 | 95 | 17,923 | 124 | 23,455 |
| Element | 83 | 11,522 | 15 | 2,820 | 98 | 14,342 |
| Protea Hotels | - | - | 65 | 6,698 | 65 | 6,698 |
| Timeshare* | 72 | 18,839 | 21 | 3,906 | 93 | 22,745 |
| Yacht* | - | - | 1 | 149 | 1 | 149 |
| Grand Total | 5,952 | 987,758 | 2,401 | 546,314 | 8,353 | 1,534,072 |
| *Timeshare and Yacht counts are included in this table by geographical location. For external reporting purposes, these offerings are captured within "Unallocated corporate and other." | ||||||
| In the above table, The Luxury Collection, Autograph Collection and Tribute Portfolio include seven total properties that we acquired when we purchased Elegant Hotels Group plc in December 2019 which we currently intend to re-brand under such brands after the completion of planned renovations. |
| MARRIOTT INTERNATIONAL, INC. | ||||||||||
| KEY LODGING STATISTICS | ||||||||||
| In Constant $ | ||||||||||
| Comparable Company-Operated US & Canada Properties | ||||||||||
| Three Months Ended March 31, 2023 and March 31, 2022 | ||||||||||
| REVPAR | Occupancy | Average Daily Rate | ||||||||
| Brand | 2023 | vs. 2022 | 2023 | vs. 2022 | 2023 | vs. 2022 | ||||
| JW Marriott | $249.84 | 31.9 % | 71.2 % | 15.2 % | pts. | $350.87 | 3.8 % | |||
| The Ritz-Carlton | $336.13 | 9.1 % | 65.1 % | 7.6 % | pts. | $516.26 | -3.7 % | |||
| W Hotels | $227.23 | 9.5 % | 59.2 % | 9.0 % | pts. | $384.13 | -7.2 % | |||
| Composite US & Canada Luxury1 | $309.13 | 17.7 % | 67.4 % | 10.9 % | pts. | $458.97 | -1.4 % | |||
| Marriott Hotels | $155.42 | 43.5 % | 65.6 % | 13.3 % | pts. | $237.01 | 14.4 % | |||
| Sheraton | $149.02 | 36.6 % | 64.2 % | 13.0 % | pts. | $232.23 | 8.9 % | |||
| Westin | $153.71 | 35.0 % | 64.0 % | 10.9 % | pts. | $240.12 | 12.1 % | |||
| Composite US & Canada Premium2 | $153.03 | 42.8 % | 65.5 % | 14.5 % | pts. | $233.72 | 11.2 % | |||
| US & Canada Full-Service3 | $186.91 | 32.7 % | 65.9 % | 13.7 % | pts. | $283.70 | 5.0 % | |||
| Courtyard | $100.38 | 29.4 % | 62.3 % | 7.3 % | pts. | $161.23 | 14.2 % | |||
| Residence Inn | $143.69 | 18.4 % | 74.8 % | 4.2 % | pts. | $192.14 | 11.9 % | |||
| Composite US & Canada Select4 | $114.84 | 24.8 % | 66.4 % | 6.4 % | pts. | $172.87 | 12.8 % | |||
| US & Canada - All5 | $169.53 | 31.3 % | 66.0 % | 12.0 % | pts. | $256.81 | 7.5 % | |||
| Comparable Systemwide US & Canada Properties | ||||||||||
| Three Months Ended March 31, 2023 and March 31, 2022 | ||||||||||
| REVPAR | Occupancy | Average Daily Rate | ||||||||
| Brand | 2023 | vs. 2022 | 2023 | vs. 2022 | 2023 | vs. 2022 | ||||
| JW Marriott | $240.19 | 25.8 % | 71.7 % | 13.3 % | pts. | $335.23 | 2.5 % | |||
| The Ritz-Carlton | $329.14 | 9.7 % | 64.7 % | 8.0 % | pts. | $508.62 | -3.9 % | |||
| W Hotels | $227.23 | 9.5 % | 59.2 % | 9.0 % | pts. | $384.13 | -7.2 % | |||
| Composite US & Canada Luxury1 | $286.97 | 17.5 % | 67.7 % | 10.8 % | pts. | $423.67 | -1.2 % | |||
| Marriott Hotels | $128.50 | 37.0 % | 63.1 % | 12.0 % | pts. | $203.57 | 11.0 % | |||
| Sheraton | $108.09 | 34.8 % | 60.1 % | 11.3 % | pts. | $179.95 | 9.3 % | |||
| Westin | $147.01 | 33.2 % | 65.4 % | 11.1 % | pts. | $224.89 | 10.5 % | |||
| Composite US & Canada Premium2 | $131.65 | 35.2 % | 63.3 % | 12.1 % | pts. | $207.87 | 9.3 % | |||
| US & Canada Full-Service3 | $149.33 | 30.9 % | 63.8 % | 12.0 % | pts. | $233.94 | 6.3 % | |||
| Courtyard | $98.81 | 24.3 % | 64.8 % | 6.9 % | pts. | $152.42 | 11.1 % | |||
| Residence Inn | $117.74 | 16.3 % | 73.0 % | 3.2 % | pts. | $161.32 | 11.2 % | |||
| Fairfield by Marriott | $79.83 | 16.3 % | 64.1 % | 4.5 % | pts. | $124.45 | 8.2 % | |||
| Composite US & Canada Select4 | $98.71 | 20.4 % | 67.4 % | 5.4 % | pts. | $146.40 | 10.7 % | |||
| US & Canada - All5 | $119.74 | 25.6 % | 65.9 % | 8.2 % | pts. | $181.61 | 10.1 % | |||
| 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 by Marriott, and Gaylord Hotels. | ||||||||||
| Systemwide also includes Le Méridien and Tribute Portfolio. | ||||||||||
| 3 Includes Composite US & Canada Luxury and Composite US & Canada Premium. | ||||||||||
| 4 Includes Courtyard, Residence Inn, Fairfield by Marriott, SpringHill Suites, TownePlace Suites, Four Points, Aloft, Element, | ||||||||||
| and AC Hotels by Marriott. Systemwide also includes Moxy. | ||||||||||
| 5 Includes US & Canada Full-Service and Composite US & Canada Select. | ||||||||||
| MARRIOTT INTERNATIONAL, INC. | ||||||||||
| KEY LODGING STATISTICS | ||||||||||
| In Constant $ | ||||||||||
| Comparable Company-Operated International Properties | ||||||||||
| Three Months Ended March 31, 2023 and March 31, 2022 | ||||||||||
| REVPAR | Occupancy | Average Daily Rate | ||||||||
| Region | 2023 | vs. 2022 | 2023 | vs. 2022 | 2023 | vs. 2022 | ||||
| Greater China | $81.68 | 77.8 % | 64.0 % | 23.5 % | pts. | $127.63 | 12.6 % | |||
| Asia Pacific excluding China | $116.36 | 116.2 % | 68.0 % | 24.2 % | pts. | $171.21 | 39.3 % | |||
| Caribbean & Latin America | $195.21 | 41.4 % | 66.1 % | 10.5 % | pts. | $295.22 | 19.0 % | |||
| Europe | $126.48 | 67.2 % | 60.8 % | 18.8 % | pts. | $208.12 | 15.4 % | |||
| Middle East & Africa | $140.62 | 17.0 % | 70.0 % | 3.8 % | pts. | $200.79 | 10.6 % | |||
| International - All1 | $115.77 | 61.3 % | 65.8 % | 18.6 % | pts. | $175.90 | 15.6 % | |||
| Worldwide2 | $139.84 | 43.5 % | 65.9 % | 15.6 % | pts. | $212.19 | 9.5 % | |||
| Comparable Systemwide International Properties | ||||||||||
| Three Months Ended March 31, 2023 and March 31, 2022 | ||||||||||
| REVPAR | Occupancy | Average Daily Rate | ||||||||
| Region | 2023 | vs. 2022 | 2023 | vs. 2022 | 2023 | vs. 2022 | ||||
| Greater China | $76.06 | 78.3 % | 62.9 % | 23.3 % | pts. | $120.98 | 12.2 % | |||
| Asia Pacific excluding China | $114.64 | 112.8 % | 67.4 % | 23.1 % | pts. | $170.20 | 39.9 % | |||
| Caribbean & Latin America | $165.67 | 40.9 % | 67.4 % | 11.7 % | pts. | $245.80 | 16.4 % | |||
| Europe | $98.61 | 75.6 % | 57.2 % | 19.5 % | pts. | $172.32 | 15.8 % | |||
| Middle East & Africa | $129.77 | 19.1 % | 68.2 % | 4.0 % | pts. | $190.18 | 12.0 % | |||
| International - All1 | $108.80 | 63.1 % | 63.9 % | 18.3 % | pts. | $170.39 | 16.4 % | |||
| Worldwide2 | $116.45 | 34.3 % | 65.3 % | 11.2 % | pts. | $178.31 | 11.3 % | |||
| 1 Includes Greater China, Asia Pacific excluding China, Caribbean & Latin America, Europe, and Middle East & Africa. | ||||||||||
| 2 Includes US & Canada - All and International - All. | ||||||||||
| MARRIOTT INTERNATIONAL, INC. | ||||||||||
| NON-GAAP FINANCIAL MEASURES | ||||||||||
| ADJUSTED EBITDA | ||||||||||
| ($ in millions) | ||||||||||
| Fiscal Year 2023 | ||||||||||
| First Quarter | ||||||||||
| Net income, as reported | $ 757 | |||||||||
| Cost reimbursement revenue | (4,147) | |||||||||
| Reimbursed expenses | 4,136 | |||||||||
| Interest expense | 126 | |||||||||
| Interest expense from unconsolidated joint ventures | 1 | |||||||||
| Provision for income taxes | 87 | |||||||||
| Depreciation and amortization | 44 | |||||||||
| Contract investment amortization | 21 | |||||||||
| Depreciation and amortization classified in reimbursed expenses | 31 | |||||||||
| Depreciation, amortization, and impairments from unconsolidated joint ventures | 4 | |||||||||
| Stock-based compensation | 37 | |||||||||
| Merger-related charges and other | 1 | |||||||||
| Adjusted EBITDA ** | $ 1,098 | |||||||||
| Change from 2022 Adjusted EBITDA ** | 45 % | |||||||||
| Fiscal Year 2022 | ||||||||||
| First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Total | ||||||
| Net income, as reported | $ 377 | $ 678 | $ 630 | $ 673 | $ 2,358 | |||||
| Cost reimbursement revenue | (3,146) | (3,920) | (3,931) | (4,420) | (15,417) | |||||
| Reimbursed expenses | 3,179 | 3,827 | 3,786 | 4,349 | 15,141 | |||||
| Interest expense | 93 | 95 | 100 | 115 | 403 | |||||
| Interest expense from unconsolidated joint ventures | 1 | 2 | 2 | 1 | 6 | |||||
| Provision for income taxes | 99 | 200 | 239 | 218 | 756 | |||||
| Depreciation and amortization | 48 | 49 | 50 | 46 | 193 | |||||
| Contract investment amortization | 24 | 19 | 22 | 24 | 89 | |||||
| Depreciation and amortization classified in reimbursed expenses | 26 | 29 | 32 | 31 | 118 | |||||
| Depreciation, amortization, and impairments from unconsolidated joint ventures | 13 | 3 | 7 | 4 | 27 | |||||
| Stock-based compensation | 44 | 52 | 48 | 48 | 192 | |||||
| Merger-related charges and other | 9 | - | 2 | 1 | 12 | |||||
| Gains on investees' property sales | (8) | (13) | (2) | - | (23) | |||||
| Gain on asset dispositions | - | (2) | - | - | (2) | |||||
| Adjusted EBITDA ** | $ 759 | $ 1,019 | $ 985 | $ 1,090 | $ 3,853 | |||||
| ** 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. | ||||||||||
| MARRIOTT INTERNATIONAL, INC. | |||||||
| NON-GAAP FINANCIAL MEASURES | |||||||
| ADJUSTED EBITDA FORECAST | |||||||
| SECOND QUARTER 2023 | |||||||
| ($ in millions) | |||||||
| Range | |||||||
| Estimated Second Quarter 2023 | Second Quarter 2022 ** | ||||||
| Net income excluding certain items 1 | $ 636 | $ 655 | |||||
| Interest expense | 138 | 138 | |||||
| Interest expense from unconsolidated joint ventures | 1 | 1 | |||||
| Provision for income taxes | 206 | 212 | |||||
| Depreciation and amortization | 48 | 48 | |||||
| Contract investment amortization | 22 | 22 | |||||
| Depreciation and amortization classified in reimbursed expenses | 30 | 30 | |||||
| Depreciation, amortization, and impairments from unconsolidated joint ventures | 4 | 4 | |||||
| Stock-based compensation | 55 | 55 | |||||
| Adjusted EBITDA ** | $ 1,140 | $ 1,165 | $ 1,019 | ||||
| Increase over 2022 Adjusted EBITDA ** | 12 % | 14 % | |||||
| ** | Denotes non-GAAP financial measures. 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 | Guidance excludes cost reimbursement revenue, reimbursed expenses, and merger-related charges and other expenses, each of which the company | ||||||
| cannot forecast with sufficient accuracy and without unreasonable efforts, and which may be significant, except for depreciation and amortization classified | |||||||
| in reimbursed expenses, which is included in the caption "Depreciation and amortization classified in reimbursed expenses" above. Guidance does not | |||||||
| reflect any asset sales that may occur during the year, which the company cannot forecast with sufficient accuracy and without unreasonable efforts, | |||||||
| and which may be significant. | |||||||
| MARRIOTT INTERNATIONAL, INC. | |||||||
| NON-GAAP FINANCIAL MEASURES | |||||||
| ADJUSTED EBITDA FORECAST | |||||||
| FULL YEAR 2023 | |||||||
| ($ in millions) | |||||||
| Range | |||||||
| Estimated Full Year 2023 | Full Year 2022** | ||||||
| Net income excluding certain items 1 | $ 2,523 | $ 2,659 | |||||
| Interest expense | 554 | 554 | |||||
| Interest expense from unconsolidated joint ventures | 6 | 6 | |||||
| Provision for income taxes | 660 | 704 | |||||
| Depreciation and amortization | 191 | 191 | |||||
| Contract investment amortization | 90 | 90 | |||||
| Depreciation and amortization classified in reimbursed expenses | 120 | 120 | |||||
| Depreciation, amortization, and impairments from unconsolidated joint ventures | 17 | 17 | |||||
| Stock-based compensation | 199 | 199 | |||||
| Adjusted EBITDA ** | $ 4,360 | $ 4,540 | $ 3,853 | ||||
| Increase over 2022 Adjusted EBITDA ** | 13 % | 18 % | |||||
| ** | Denotes non-GAAP financial measures. 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 | Guidance excludes cost reimbursement revenue, reimbursed expenses, and merger-related charges and other expenses, each of which the company | ||||||
| cannot forecast with sufficient accuracy and without unreasonable efforts, and which may be significant, except for depreciation and amortization classified | |||||||
| in reimbursed expenses, which is included in the caption "Depreciation and amortization classified in reimbursed expenses" above. Guidance does not | |||||||
| reflect any asset sales that may occur during the year, which the company cannot forecast with sufficient accuracy and without unreasonable efforts, | |||||||
| and which may be significant. | |||||||
| MARRIOTT INTERNATIONAL, INC. EXPLANATION OF NON-GAAP FINANCIAL AND PERFORMANCE MEASURES |
| In our press release and schedules, and on the related conference call, we report certain financial measures that are not required by, or presented in accordance with, United States generally accepted accounting principles ("GAAP"). We discuss the manner in which the non-GAAP measures reported in this press release and schedules are determined and management's reasons for reporting these non-GAAP measures below, and the press release schedules reconcile the most directly comparable GAAP measure to each non-GAAP measure that we refer to. Although management evaluates and presents these non-GAAP measures for the reasons described below, please be aware that these non-GAAP measures have limitations and should not be considered in isolation or as a substitute for revenue, operating income, net income, earnings per share or any other comparable operating measure prescribed by GAAP. In addition, we may calculate and/or present these non-GAAP financial measures differently than measures with the same or similar names that other companies report, and as a result, the non-GAAP measures we report may not be comparable to those reported by others. |
| Adjusted Operating Income and Adjusted Operating Income Margin. Adjusted operating income and Adjusted operating income margin exclude cost reimbursement revenue, reimbursed expenses, merger-related charges and other expenses, and certain non-cash impairment charges. Adjusted operating income margin reflects Adjusted operating income divided by Adjusted total revenues. We believe that these are meaningful metrics because they allow for period-over-period comparisons of our ongoing operations before these items and for the reasons further described below. |
| Adjusted Net Income and Adjusted Diluted Earnings Per Share. Adjusted net income and Adjusted diluted earnings per share reflect our net income and diluted earnings per share excluding the impact of cost reimbursement revenue, reimbursed expenses, merger-related charges and other expenses, certain non-cash impairment charges, gains and losses on asset dispositions made by us or by our joint venture investees (when applicable), the income tax effect of these adjustments, and income tax special items. The income tax special items primarily related to the resolution of a prior year tax audit. We calculate the income tax effect of the adjustments using an estimated tax rate applicable to each adjustment. We believe that these measures are meaningful indicators of our performance because they allow for period-over-period comparisons of our ongoing operations before these items and for the reasons further described below. |
| Adjusted Earnings Before Interest Expense, Taxes, Depreciation and Amortization ("Adjusted EBITDA"). Adjusted EBITDA reflects net income excluding the impact of the following items: cost reimbursement revenue and reimbursed expenses, interest expense, depreciation and amortization (including depreciation and amortization classified in "Reimbursed expenses," as discussed below), provision for income taxes, merger-related charges and other expenses, and stock-based compensation expense for all periods presented. When applicable, Adjusted EBITDA also excludes certain non-cash impairment charges related to equity investments and gains and losses on asset dispositions made by us or by our joint venture investees. |
| In our presentations of Adjusted operating income and Adjusted operating income margin, Adjusted net income and Adjusted diluted earnings per share, and Adjusted EBITDA, we exclude a one-time cost in the 2022 first quarter related to certain property-level adjustments related to compensation and transition costs associated with the Starwood merger, which we record in the "Merger-related charges and other" caption of our Condensed Consolidated Statements of Income (our "Income Statements"), to allow for period-over period comparisons of our ongoing operations before the impact of these items. We also exclude non-cash impairment charges (if above a specified threshold) related to our management and franchise contracts (if the impairment is non-routine), leases, equity investments, and other capitalized assets, which we record in the "Contract investment amortization," "Depreciation, amortization, and other," and "Equity in earnings" captions of our Income Statements to allow for period-over period comparisons of our ongoing operations before the impact of these items. We exclude cost reimbursement revenue and reimbursed expenses, which relate to property-level and centralized programs and services that we operate for the benefit of our hotel owners. We do not operate these programs and services to generate a profit over the long term, and accordingly, when we recover the costs that we incur for these programs and services from our hotel owners, we do not seek a mark-up. For property-level services, our owners typically reimburse us at the same time that we incur expenses. However, for centralized programs and services, our owners may reimburse us before or after we incur expenses, causing timing differences between the costs we incur and the related reimbursement from hotel owners in our operating and net income. Over the long term, these programs and services are not designed to impact our economics, either positively or negatively. Because we do not retain any such profits or losses over time, we exclude the net impact when evaluating period-over-period changes in our operating results. |
| We believe that Adjusted EBITDA is a meaningful indicator of our operating performance because it permits period-over-period comparisons of our ongoing operations before these items. Our use of Adjusted EBITDA also facilitates comparison with results from other lodging companies because it excludes certain items that can vary widely across different industries or among companies within the same industry. For example, interest expense can be dependent on a company's capital structure, debt levels, and credit ratings. Accordingly, the impact of interest expense on earnings can vary significantly among companies. The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provisions for income taxes can vary considerably among companies. Our Adjusted EBITDA also excludes depreciation and amortization expense, which we report under "Depreciation, amortization, and other" as well as depreciation and amortization classified in "Contract investment amortization," "Reimbursed expenses," and "Equity in earnings" of our Income Statements, because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. Depreciation and amortization classified in "Reimbursed expenses" reflects depreciation and amortization of Marriott-owned assets and software, for which we receive cash from owners to reimburse the company for its investments made for the benefit of the system. These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies. We exclude stock-based compensation expense in all periods presented to address the considerable variability among companies in recording compensation expense because companies use stock-based payment awards differently, both in the type and quantity of awards granted. |
| MARRIOTT INTERNATIONAL, INC. EXPLANATION OF NON-GAAP FINANCIAL AND PERFORMANCE MEASURES |
| RevPAR. In addition to the foregoing non-GAAP financial measures, we present Revenue per Available Room ("RevPAR") as a performance measure. We believe RevPAR is a meaningful indicator of our performance because it measures the period-over-period change in room revenues for comparable properties. RevPAR relates to property level revenue and may not be comparable to similarly titled measures, such as revenues, and should not be viewed as necessarily correlating with our fee revenue. We calculate RevPAR by dividing room sales (recorded in local currency) for comparable properties by room nights available for the period. We present growth in comparative RevPAR on a constant dollar basis, which we calculate by applying exchange rates for the current period to each period presented. We believe constant dollar analysis provides valuable information regarding our properties' performance as it removes currency fluctuations from the presentation of such results. |
SOURCE Marriott International, Inc.