What was the immediate financial impact of the September 11th terrorist attacks on Marriott International?

Following the September 11th attacks, Marriott International experienced significant short-term declines in hotel occupancy. This led to a decrease in net income for the third quarter of 2001 compared to the prior year and an anticipated substantial decline in REVPAR for the fourth quarter of 2001. The company is actively assessing the ongoing impact on its operations, financial condition, and cash flows.

How did Marriott International's sales and profitability perform in the first nine months of 2001 compared to 2000?

For the first nine months of 2001 (thirty-six weeks ended September 7, 2001), Marriott International reported a 6% increase in sales to $7.284 billion and a 7% increase in net income to $352 million compared to the same period in 2000. This overall growth was positively impacted by a favorable comparison to 2000, which included a significant pretax charge in its distribution services business.

What is the company's outlook for the remainder of 2001 and for 2002, given the economic environment?

Marriott anticipates a challenging business environment. For the fourth quarter of 2001, they project REVPAR to decline 25% to 35% year-over-year. For 2002, the company expects REVPAR to be 15% lower than 2000 levels and plans to reduce investment spending by at least one-third compared to 2001. Earnings per share are projected to be roughly flat with 2001 levels.

What significant financing activities did Marriott undertake during this period?

In May 2001, Marriott International issued $405 million in zero-coupon convertible senior notes (LYONs) due 2021. The company also had $500 million available under universal shelf registration statements for future offerings and had $300 million in senior unsecured notes issued privately in January 2001.

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

Summary

Marriott International, Inc. (MAR) filed an amended 10-Q for the period ending September 7, 2001. The report highlights a challenging operating environment, particularly in the aftermath of the September 11th terrorist attacks, which led to significant short-term declines in hotel occupancy and revenue per available room (REVPAR). Despite these headwinds, the company reported a slight increase in sales for the thirty-six weeks ended September 7, 2001, compared to the prior year, with net income also seeing a modest rise. However, the third quarter of 2001 showed a decrease in net income year-over-year, reflecting the immediate impact of the challenging economic conditions and the post-9/11 environment. Financially, the company maintained a strong liquidity position with substantial cash and equivalents and available borrowing capacity. Significant financing activities included the issuance of convertible senior notes, strengthening its capital structure. Management is actively analyzing cost structures and operational performance to mitigate the impact of the downturn and is forecasting continued challenges for the remainder of 2001 and into 2002, with planned reductions in investment spending for the upcoming year.

Key Highlights

1Net income for the thirty-six weeks ended September 7, 2001, increased by 7% to $352 million, on sales of $7,284 million, a 6% increase over the same period in 2000.
2The third quarter of 2001 saw a 8% decrease in net income to $101 million, on sales of $2,373 million, a 3% increase compared to the prior year's third quarter.
3REVPAR for comparable company-operated U.S. properties declined significantly, with an average decrease of 10.0% in the third quarter of 2001 and 4.1% for the first three quarters of 2001.
4The company experienced a substantial increase in cash and equivalents, reaching $874 million at September 7, 2001, an increase of $540 million from year-end 2000, partly due to the issuance of convertible debt.
5Financing activities included the issuance of $405 million in zero-coupon convertible senior notes (LYONs) in May 2001.
6The company's outlook projects continued challenges, with an expectation of a 25% to 35% decline in fourth-quarter REVPAR and plans to reduce investment spending by at least one-third in 2002.
7The report acknowledges the significant adverse impact of the September 11th terrorist attacks on hotel occupancy and forecasts potential charges and material adverse impacts on financial position, results of operations, and cash flows.

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

Summary

Key Highlights

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