Marriott International tops estimates as international demand soars
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Marriott International (NASDAQ:MAR) traded slightly higher on Tuesday after topping Q2 earnings estimates and issuing strong guidance.
Comparable systemwide constant dollar RevPAR increased 13.5% globally, driven higher by a 39.1% jump in international markets. Notably, Greater China rebounded quickly once travel restrictions were lifted in January, with RevPAR surpassing pre-pandemic levels. RevPAR was up 6.0% for the U.S. and Canada region. The global average daily rate for the hotel operator was up 6.0% to $183.79, with strong ADR growth recorded in Asia, Europe, and Middle East & Africa.
The hotel operator noted that within customer segments, group once again performed extremely well, with revenue up 10% from a year ago. Business transient revenue also saw strong year-over-year growth, driven by solid average daily rate growth. Leisure transient revenue rose more slowly, as more travelers from the region chose to visit overseas destinations.
Adjusted EBITDA totaled $1.219B in the quarter compared to $1.019B a year ago. Net income totaled $726M vs. $678M last year.
Marriott's (MAR) worldwide development pipeline totaled more than 3.1K properties and nearly 547K rooms at the end of the quarter, including roughly 31.5K of pipeline rooms approved, but not yet subject to signed contracts. More than 240K rooms in the pipeline, including approximately 37K rooms from the company's deal with MGM Resorts International, were under construction as of the end of the second quarter.
On the balance sheet, Marriott (MAR) ended the quarter with total debt of $11.3B and a cash position of $600M. Marriott (MAR) has repurchased 13.6M shares for $2.3B year-to-date through July 28.
Looking ahead, Marriott now sees full-year EPS of $8.36 to $8.55 vs. $8.36 consensus and a prior outlook for $7.97 to $8.42. Adjusted EBITA of $4.54B to $4.65B is expected.
Shares of Marriott International (MAR) tracked 0.17% higher in premarket trading to $201.89.
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