Marriott Sees Measure of Performance Declining About 23% in 1Q
14 April 2020 - 11:30PM
Dow Jones News
By Dave Sebastian
Marriott International Inc., battered from the fallout of the
coronavirus pandemic, said it expects a measure of performance to
decline by double digits for the first quarter amid a drought in
demand.
The world's largest hotel company on Tuesday said it sees
revenue per available room, a closely watched industry metric also
known as RevPAR, declining about 23% worldwide for the first
quarter, with the reading for March expected to be about down
60%.
The company expects RevPAR to fall about 20% in North America
for the quarter. For March, Marriott said it could book RevPAR
declines of about 74% in Asia Pacific--83% in Greater China and 68%
in the rest of Asia--57% in North America, 71% in Europe, 57% in
the Caribbean and Latin America and 56% in the Middle East and
Africa.
Also on Tuesday, Marriott said it entered a new $1.5 billion
364-day revolving credit facility commitment as it seeks to
maintain liquidity. The company also received a leverage covenant
waiver for its existing credit facility, it said.
Although mainland China has begun reopening its economy, the
outlook is still dim in other parts of the world, Marriott said.
About a quarter of Marriott's some 7,300 hotels are temporarily
closed, and the company expects erosion in RevPAR performance until
the crisis has moderated and governments have lifted restrictions
that have been in place to contain the pathogen's spread, it
said.
In Greater China, where the crisis started unfolding in late
January, occupancy rose in the first week of April, with the number
of closed hotels declining to under 20 from more than 90 in
mid-February, Marriott said. For the recent Qingming holiday
weekend on April 4 and 5, Marriott said occupancy was north of 60%
in more than 20 hotels in leisure-heavy destinations.
But North American occupancy levels remain at around 10%, and
more than 870 hotels, or 16%, are temporarily closed, the company
said. Europe occupancy also stands at under 10%, while 54% of
hotels in the Middle East and Africa Region are closed. Nearly 70%
of hotels in the Caribbean and Latin America are closed, Marriott
said.
Shares rose 4.5% in premarket trading
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
April 14, 2020 09:15 ET (13:15 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Marriott (NASDAQ:MAR)
Historical Stock Chart
From Apr 2024 to May 2024
Marriott (NASDAQ:MAR)
Historical Stock Chart
From May 2023 to May 2024