What was the impact of the September 11th terrorist attacks on Marriott's Q3 2001 results?

The report states that Marriott was adversely affected in the aftermath of the terrorist attacks. While the full impact was not yet quantifiable at the time of filing, the company experienced significant short-term declines in hotel occupancy and projected a substantial decline in REVPAR for the fourth quarter of 2001.

How did Marriott's different business segments perform in Q3 2001?

The lodging segment, particularly full-service brands, saw a significant decline in operating profit and REVPAR. However, the timeshare business performed strongly with increased profit and sales, and Senior Living Services also showed improvement by turning a profit.

What is Marriott's outlook for the remainder of 2001 and into 2002?

Marriott anticipates the business environment to remain challenging. For Q4 2001, they forecast a REVPAR decline of 25-35% and project earnings per share between $0.20 to $0.30. For 2002, they expect REVPAR to be 3-5% lower than 2001 (roughly 15% lower than 2000), with 2002 earnings per share potentially being flat compared to 2001.

What was the company's financial position regarding cash and debt?

Marriott ended the quarter with a strong cash position of $874 million, an increase from the prior year, partly due to the issuance of $405 million in convertible senior notes (LYONs). The company also had access to over $2 billion in cash and borrowing capacity, which it considered adequate for its liquidity needs.

MAR 10-Q Quarterly Report Q3 FY2001 — Revenue, Net Income, EPS

Summary

Marriott International, Inc. (MAR) reported its third-quarter 2001 results, reflecting a challenging operating environment in the wake of the September 11th terrorist attacks. For the twelve weeks ended September 7, 2001, the company's net income decreased by 8% to $101 million, or $0.39 per diluted share, compared to the prior year. Sales saw a modest 2% increase to $2,345 million. The lodging segment experienced a significant 19% decrease in operating profit, with comparable company-operated U.S. properties seeing a 10% decline in Revenue Per Available Room (REVPAR) due to lower occupancy and average room rates. Despite the headwinds, Marriott International demonstrated resilience in certain areas. The timeshare business showed robust growth with a 15% increase in operating profit, driven by strong demand and a strategic acquisition. Senior Living Services also improved, moving from a net loss to a profit. The company ended the quarter with a strong cash position of $874 million, an increase of $540 million from year-end 2000, bolstered by the issuance of convertible debt. Management anticipates continued challenges through the end of 2001 and into 2002, with a projected REVPAR decline for Q4 2001 and a cautious outlook for 2002.

Key Highlights

1Net income for the third quarter decreased by 8% to $101 million ($0.39/share) on sales of $2,345 million, a 2% increase.
2Comparable U.S. company-operated lodging REVPAR declined 10.0% in Q3 2001 due to a 5.6 percentage point drop in occupancy and a 3.4% decrease in average room rates.
3The timeshare segment reported a 15% increase in operating profit and a 57% rise in contract sales, driven by strong demand and an acquisition.
4Marriott Senior Living Services improved to an operating profit of $3 million from a loss in the prior year, with occupancy increasing slightly.
5The company ended the quarter with $874 million in cash and equivalents, up significantly from $334 million at year-end 2000.
6Marriott issued $405 million in zero-coupon convertible senior notes (LYONs) in May 2001.
7The company provided a cautious outlook, forecasting a 25-35% decline in Q4 2001 REVPAR and expecting 2002 earnings per share to be roughly flat with 2001.

MARRIOTT INTERNATIONAL INC /MD/ Quarterly Report for Q3 Ended Sep 7, 2001

Summary

Key Highlights

Frequently Asked Questions