Marriott International Inc. (MAR), the largest publicly traded U.S. hotel chain, reported third-quarter earnings that beat analysts’ estimates as demand rose for rooms at the company’s North American properties.
Net income climbed to $160 million, or 52 cents a share, from $143 million, or 44 cents, a year earlier, the Bethesda, Maryland-based company said today in a statement. The average estimate of 14 analysts was 44 cents a share, according to data compiled by Bloomberg.
Earnings beat the company’s own forecast of 42 cents to 46 cents as Marriott was helped by demand from leisure travelers in the U.S. and growth in bookings by both individual business travelers and companies using hotels for conferences and seminars. Worldwide occupancy reached a six-year high, the company said in today’s statement.
“We had a solid quarter,” Chief Executive Officer Arne Sorenson said in the statement. “Short-term group business picked up in North America and occupancy rates reached nearly 75 percent worldwide.”
Business group reservations for next year grew at a faster pace in the third quarter than in the previous three months, Marriott said.
Revenue per available room, an industry measure of occupancies and rates, climbed 5.5 percent from a year earlier at company-operated hotels in North America. Worldwide, revpar increased 4.8 percent, adjusted for currency fluctuations, according to the statement. Total revenue climbed to $3.16 billion from $2.73 billion.
Marriott said it expects North American and worldwide revpar to increase 4 percent to 6 percent next year. For the fourth quarter, Marriott forecast comparable systemwide revpar to climb 4.5 percent to 5.5 percent in North America. Hotel demand in the U.S. was affected by the government shutdown in October, the company said.
Because of a change in the company’s fiscal calendar, the third quarter was 92 days long, compared with 84 days last year.
Marriott announced its third-quarter results after the close of regular U.S. trading. Its shares fell 0.9 percent to $44.20 in New York today.
Starwood Hotels & Resorts Worldwide Inc. (HOT), owner of the luxury St. Regis and W brands, last week said revpar in the third quarter, adjusted for currency fluctuations, rose 4.7 percent worldwide and 5.8 percent in North America. The hotelier’s shares last week rose the most in three months after it reported third-quarter earnings that beat estimates and forecast an increase in revenue growth for 2014.
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