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Marriott International Reports 1st Qtr 2010 Profit, Reversing a $23 million
 Loss Last Year; Net Income  of $83 million on Revenue Increase
 of  5% to $2.63 billion

Key Lodging Statistics

 


BETHESDA, Md.
, April 22, 2010 - Marriott International, Inc. (NYSE: MAR) today reported first quarter 2010 results, exceeding its revenue per available room (REVPAR) and diluted earnings per share (EPS) expectations.


FIRST QUARTER 2010 RESULTS

First quarter 2010 net income totaled $83 million, a 5 percent decline compared to first quarter 2009 adjusted net income.  Diluted EPS totaled $0.22, down $0.02 from adjusted diluted EPS in the year-ago quarter.  On February 11, 2010, the company forecasted first quarter diluted EPS of $0.15 to $0.21.

Reported net income was $83 million in the first quarter of 2010 compared to a reported net loss of $23 million in the year-ago quarter.  Reported diluted EPS was $0.22 in the first quarter of 2010 compared to reported diluted losses per share of$0.06 in the first quarter of 2009.

Adjusted results for the 2009 first quarter exclude $129 million pretax ($84 million after-tax and $0.24 per diluted share) of restructuring costs and other charges and $26 million of non-cash charges ($0.07 per diluted share) in the provision for income taxes.

J.W. Marriott, Jr., chairman and chief executive officer of Marriott International, said, "In the first quarter we welcomed increasing numbers of business guests to our hotels as travelers got back to work in most markets around the world.  Corporate roomnights for the Marriott Hotels & Resort brand in North America rose 16 percent in the first quarter as business demand strengthened dramatically.  At the same time, leisure demand remained solid as vacationers continued to find memorable holiday experiences and good values.  While first quarter room rates were generally lower than last year, as occupancy levels continue to improve, we see higher room rates on the horizon.  In fact, we anticipate that North American systemwide REVPAR will increase by 3 to 6 percent for the full year 2010 with higher room rates by year end.  International demand trends are even stronger.  We expect REVPAR outside North America will increase 4 to 7 percent on a constant dollar basis in 2010 reflecting strong demand in Europe, South America and Asia.

Over 8,000 new rooms joined our system during the first quarter including the JW Marriott Los Angeles L.A. LIVE, the JW Marriott Hill Country Resort and Spa in San Antonio, and the Shanghai Marriott Hotel Changfeng Park, our 47th hotel inChina.  We also launched our newest brand, The Autograph Collection, with two new properties, Casa Monica Hotel in St. Augustine Florida and the Grand Bohemian Hotel in Asheville, North Carolina.

With stronger demand and meaningful unit growth, fee revenue and earnings per share exceeded our expectations.  2010 is shaping up to be a good year."

REVPAR for the company's worldwide comparable company-operated properties was flat (a 1.0 percent decline using constant dollars) in the 2010 first quarter and REVPAR for the company's worldwide comparable systemwide properties declined 0.7 percent (a 1.3 percent decline using constant dollars).

International comparable company-operated REVPAR rose 5.8 percent (a 1.5 percent increase using constant dollars), including a 4.5 percent decline in average daily rate (a 8.3 percent decline using constant dollars) in the first quarter of 2010.

In North America, comparable company-operated REVPAR declined 1.9 percent in the first quarter of 2010.  REVPAR at the company's comparable company-operated North American full-service and luxury hotels (including Marriott Hotels & Resorts, The Ritz-Carlton and Renaissance Hotels) was down 1.2 percent with a 7.8 percent decline in average daily rate.

Marriott added 44 new properties (8,361 rooms) to its worldwide lodging portfolio in the 2010 first quarter and seven properties (1,146 rooms) exited the system during the quarter.  At quarter-end, the company's lodging group encompassed 3,457 properties and timeshare resorts for a total of over 603,000 rooms.

The company's worldwide pipeline of hotels under construction, awaiting conversion or approved for development totaled over 95,000 rooms in more than 600 hotels at quarter-end.

MARRIOTT REVENUES totaled over $2.6 billion in the 2010 first quarter compared to approximately $2.5 billion for the first quarter of 2009.  Base management and franchise fees rose 1 percent to $216 million reflecting fees from new hotels offset by slightly lower REVPAR.  First quarter incentive management fees declined 7 percent to $40 million.  In the first quarter, 23 percent of company-managed hotels earned incentive management fees compared to 25 percent in the year-ago quarter.  Approximately 60 percent of incentive management fees came from hotels outside North America in the 2010 quarter compared to 54 percent in the 2009 quarter.

Worldwide comparable company-operated house profit margins declined 110 basis points in the first quarter reflecting increasing occupancy and declining rate partially offset by efficiency improvements at the property level.  House profit margins for comparable company-operated properties outside North America increased 40 basis points and North American comparable company-operated house profit margins declined 180 basis points from the year-ago quarter.

Owned, leased, corporate housing and other revenue, net of direct expenses, declined $1 million in the 2010 first quarter, to $12 million, primarily reflecting the impact of lower operating results in owned and leased hotels partially offset by $4 million of termination fees.

First quarter adjusted Timeshare segment contract sales increased 10 percent to $172 million excluding an $8 millionallowance for fractional and residential contract cancellations recorded in the quarter.  In the prior year's quarter, adjusted Timeshare segment contract sales totaled $157 million excluding a $28 million allowance for contract cancellations.

In the first quarter, timeshare sales and services revenue totaled $285 million and, net of expenses, totaled $50 million for the quarter.  Adjusting for restructuring and other charges, as well as the impact of consolidation of securitized loans as if such consolidation had occurred at the beginning of 2009, first quarter 2009 timeshare sales and services revenue would have totaled $254 million and, net of direct expenses, would have totaled $25 million.  These adjustments for the 2009 quarter are shown on page A-14.

Timeshare development revenue, net of expense, benefited from stronger demand, higher closing efficiency, favorable reportability and lower marketing and sales costs.

Timeshare segment results include Timeshare sales and services revenue, net of direct expenses, as well as base management fees, equity earnings (losses), noncontrolling interest, interest expense and general, administrative and other expenses associated with the timeshare business.  Timeshare segment results for the 2010 first quarter, shown on page A-6, totaled $25 million, including $14 million of interest expense related to the consolidation of securitized Timeshare notes.  On February 11, 2010, the company provided Timeshare segment guidance of $30 million to $40 million, excluding interest expense associated with securitized Timeshare notes.

GENERAL, ADMINISTRATIVE and OTHER expenses for the 2010 first quarter increased 1 percent to $138 million, compared to adjusted expenses of $136 million in the year-ago quarter.  The 2010 first quarter benefited from $6 million in guarantee reserve reversals and $4 million of lower receivable reserves partially offset by higher legal expenses of $3 million.  The 2009 first quarter benefited from $8 million of incentive compensation and other accrual reversals and a $5 million favorable impact associated with deferred compensation.

GAINS AND OTHER INCOME totaled $1 million primarily reflecting gains on the sale of real estate.  The prior year's first quarter gains and other income totaled $25 million and included a $21 million gain on the extinguishment of debt, $3 million of gains on the sale of real estate and other income and $1 million of preferred returns from joint venture investments.

INTEREST EXPENSE increased $16 million to $45 million in the first quarter primarily due to $14 million of interest expense related to the consolidation of debt associated with securitized Timeshare notes, lower capitalized interest and interest associated with deferred compensation partially offset by lower debt balances and interest rates.  Adjusting for the impact of consolidation of securitized loans as if such consolidation had occurred at the beginning of 2009, first quarter 2009 interest expense would have totaled $45 million, flat with 2010 first quarter interest expense.

EQUITY IN (LOSSES) EARNINGS totaled an $11 million loss in the quarter compared to a $3 million adjusted loss in the year-ago quarter.  The $8 million decline primarily reflected a $4 million increase in cancellation reserves at one Timeshare joint venture and impairment charges of $3 million associated with two investments.

Earnings before Interest Expense, Taxes, Depreciation and Amortization (EBITDA)

EBITDA totaled $221 million in the 2010 first quarter.  In the 2009 first quarter, adjusted EBITDA totaled $215 million.  If the consolidation of securitized timeshare notes had occurred at the beginning of 2009, adjusted EBITDA in 2009 would have totaled $235 million.

BALANCE SHEET

At the end of the first quarter 2010, total debt was $3,269 million and cash balances totaled $118 million, compared to$2,298 million in debt and $115 million of cash at year-end 2009.  The increase in debt included $1,043 million of debt associated with securitized Timeshare mortgage notes now required to be consolidated, as noted below.  At the end of the first quarter 2010, Marriott had borrowings of $396 million outstanding under its $2.4 billion bank revolver.

COMMON STOCK

Weighted average fully diluted shares outstanding used to calculate diluted EPS totaled 373.3 million in the 2010 first quarter compared to weighted average fully diluted shares outstanding of 360.5 million used to calculate adjusted diluted EPS in the year-ago quarter.

The remaining share repurchase authorization, as of March 26, 2010, totaled 21.3 million shares.  No share repurchases are planned for 2010.

IMPACT OF ACCOUNTING CHANGES

The company adopted ASU Nos. 2009-16 and 2009-17 (formerly referred to as FAS 166 and 167) at the beginning of 2010, which required consolidation of entities associated with securitized Timeshare notes and impacts the ongoing accounting for those notes.  With the consolidation of the existing portfolio of securitized loans on the first day of fiscal 2010, assets increased by $970 million, liabilities increased by $1,116 million, and shareholders' equity decreased by $146 million.  No change in net cash flow is anticipated as a result of the accounting changes.  If the consolidation had occurred at the beginning of 2009, first quarter 2009 adjusted revenue would have increased to $2,540 million, first quarter 2009 adjusted EBITDA would have increased to $235 million, first quarter 2009 interest expense would have increased to $45 million and first quarter 2009 adjusted pretax income would have increased to $141 million.  See the tables on pages A-14, A-15, A-16, A-17 and A-18 of the accompanying schedules for 2009 quarterly and full year Timeshare segment results adjusted as if the accounting changes had been made on the first day of fiscal 2009.

SECOND QUARTER 2010 OUTLOOK

For the second quarter, the company assumes comparable systemwide REVPAR on a constant dollar basis will increase 4 to 6 percent in North America, 8 to 10 percent outside North America and 5 to 7 percent worldwide.

In the 2010 second quarter, the company assumes Timeshare contract sales will total $175 million to $185 million and Timeshare sales and services revenue, net of direct expenses, will total approximately $40 million to $45 million.  With these assumptions, Timeshare segment results for the second quarter, including interest expense associated with securitized notes, are expected to total $20 million to $25 million.

FULL YEAR 2010 OUTLOOK

For the full year 2010, the company assumes comparable systemwide REVPAR on a constant dollar basis will increase 3 to 6 percent in North America, 4 to 7 percent outside North America and 3 to 6 percent worldwide.

The company expects to open 25,000 to 30,000 rooms in 2010 as most hotels expected to open are already under construction or undergoing conversion from other brands.

The company continues to estimate that, on a full-year basis, one point of worldwide systemwide REVPAR impacts total fees by approximately $10 million to $15 million pretax and owned, leased, corporate housing and other revenue, net of direct expense, by roughly $4 million pretax.

For its timeshare business, the company assumes 2010 timeshare contract sales will be slightly higher than 2009 levels.  For 2010, Timeshare sales and services revenue, net of direct expenses, is expected to total $185 million to $195 million.  Timeshare segment results for 2010, including interest expense associated with previously securitized notes, is expected to total $95 million to $105 million.

The company expects its 2010 general, administrative and other expenses to total $650 million to $660 million reflecting higher incentive compensation.




Second Quarter 
2010

Full Year 
2010


Total fee revenue

$275 million to $285 million

$1,145 million to $1,175 million


Owned, leased, corporate housing and other revenue, net of direct expenses

Approx $25 million

$75 million to $80 million


Timeshare sales and services revenue, net of direct expenses

$40 million to $45 million

$185 million to $195 million


General, administrative and other expenses

Approx $150 million

$650 million to $660 million


Operating income

$190 million to $205 million

$745 million to $800 million


Gains and other income

$0 to $5 million

Approx $15 million


Net interest expense1

Approx $40 million

$165 million to $170 million


Equity in earnings (losses)

Approx $0 million

Approx $30 million


Earnings per share

$0.25 to $0.29

$0.95 to $1.05


Tax rate

36 percent

36 percent


1 Net of interest income







Based upon the assumptions above, full year 2010 EBITDA is expected to total $985 million to $1,040 million.  Assuming the investment spending levels below, adjusted total debt is expected to decline $400 million to $500 million by year end 2010.

The company expects investment spending in 2010 will total approximately $500 million, including capital expenditures totaling $150 million to $200 million, of which maintenance capital spending is expected to total $50 million.  Investment spending will also include new mezzanine financing and mortgage loans, contract acquisition costs, and equity and other investments.  The investment in net timeshare development is not included above as the company expects cost of goods sold in the timeshare business will exceed timeshare inventory spending in 2010.

Marriott International, Inc. (NYSE: MAR) will conduct its quarterly earnings review for the investment community and news media on Thursday, April 22, 2010 at 10 a.m. Eastern Time (ET).  The conference call will be webcast simultaneously via Marriott's investor relations website at http://www.marriott.com/investor, click the "Recent and Upcoming Events" tab and click on the quarterly conference call link.  A replay will be available at that same website until April 22, 2011.

The telephone dial-in number for the conference call is 719-325-2122.  A telephone replay of the conference call will be available from 1 p.m. ET, Thursday, April 22, 2010 until 8 p.m. ET, Thursday, April 29, 2010.  To access the replay, call 719-457-0820.  The reservation number for the recording is 7418222.

Definitions

All references to net income or net loss, unless otherwise noted, reflect net income or net loss attributable to Marriott.  All references to EPS or diluted losses per share, unless otherwise noted, reflect EPS or diluted losses per share attributable to Marriott shareholders.

Note:  This press release and accompanying schedules contain "forward-looking statements" within the meaning of federal securities laws, including REVPAR, profit margin and earnings trends, estimates and assumptions; statements concerning the number of lodging properties we expect to add in the future; our expected cost savings, investment spending and share repurchases; and similar statements concerning anticipated future events and expectations that are not historical facts.  We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including the continuation and pace of the economic recovery; supply and demand changes for hotel rooms, vacation ownership, condominiums, and corporate housing; competitive conditions in the lodging industry; relationships with clients and property owners; the availability of capital to finance hotel growth and refurbishment; and other risk factors identified in our most recent annual or quarterly report on Form 10-K or Form 10-Q; any of which could cause actual results to differ materially from those expressed in or implied by the statements herein.  These statements are made as of the date of this press release, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

MARRIOTT INTERNATIONAL, INC. (NYSE: MAR) is a leading lodging company with more than 3,400 lodging properties in 70 countries and territories. Marriott International operates and franchises hotels under the Marriott, JW Marriott, The Ritz-Carlton, The Autograph Collection, Renaissance, Residence Inn, Courtyard, TownePlace Suites, Fairfield Inn, SpringHill Suites and Bulgari brand names; develops and operates vacation ownership resorts under the Marriott Vacation Club, The Ritz-Carlton Destination Club, and Grand Residences by Marriott brands; licenses and manages whole-ownership residential brands, including The Ritz-Carlton Residences, JW Marriott Residences and Marriott Residences; operatesMarriott Executive Apartments; provides furnished corporate housing through its Marriott ExecuStay division; and operates conference centers. The company is headquartered in Bethesda, Maryland, USA, and had approximately 137,000 employees at 2009 year-end. It is recognized by FORTUNE® as one of the best companies to work for, and by Newsweekas one of the greenest big companies in America. In fiscal year 2009, Marriott International reported sales from continuing operations of nearly $11 billion. For more information or reservations, please visit our web site at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

I

Marriott International, Inc.


Press Release Schedules


Quarter 1, 2010


Table of Contents














Consolidated Statements of Income


A-1






Total Lodging Products


A-3






Key Lodging Statistics


A-4






Timeshare Segment


A-6






EBITDA


A-7






Total Debt


A-8






First Quarter 2009 Revenue, Interest Expense and Income Before Income Taxes As Adjusted Had ASU Nos. 2009-16 and 2009-17 Been Adopted on January 3, 2009


A-9






First Quarter 2009 EBITDA As Adjusted Had ASU Nos. 2009-16 and 2009-17 Been Adopted on January 3, 2009


A-10






2009 EBITDA As Adjusted Had ASU Nos. 2009-16 and 2009-17 Been Adopted on January 3, 2009 and Forecasted 2010


A-11






Second Quarter 2009 General, Administrative, and Other Expenses Excluding Restructuring Costs and Other Charges


A-12






Timeshare Inventory As Adjusted Had ASU Nos. 2009-16 and 2009-17 Been Adopted on January 3, 2009


A-13






2009 Timeshare Segment As Adjusted Had ASU Nos. 2009-16 and 2009-17 Been Adopted on January 3, 2009


A-14






Non-GAAP Financial Measures


A-19







MARRIOTT INTERNATIONAL, INC.


CONSOLIDATED STATEMENTS OF INCOME


(in millions, except per share amounts)












Adjustments






As Reported
12 Weeks
Ended
March 26, 2010


As Reported
12 Weeks
Ended
March 27, 2009

Restructuring Costs
& Other Charges

Certain
Tax Items

As Adjusted
12 Weeks
Ended
March 27, 2009**


Percent
Better/(Worse) 2010
vs.
Adjusted 2009






















REVENUES










Base management fees

$                 125


$                  125

$                    -

$             -

$                    125


-


Franchise fees

91


88

-

-

88


3


Incentive management fees

40


43

-

-

43


(7)


Owned, leased, corporate housing and other revenue 1

229


220

-

-

220


4


Timeshare sales and services (including net note sale losses of $1 for the twelve weeks ended March 27, 2009) 2

285


209

17

-

226


26


Cost reimbursements 3

1,860


1,810

-

-

1,810


3


  Total Revenues

2,630


2,495

17

-

2,512


5












OPERATING COSTS AND EXPENSES










Owned, leased and corporate housing - direct 4

217


207

-

-

207


(5)


Timeshare - direct

235


220

1

-

221


(6)


Reimbursed costs

1,860


1,810

-

-

1,810


(3)


Restructuring costs

-


2

(2)

-

-


-


General, administrative and other 5

138


216

(80)

-

136


(1)


  Total Expenses

2,450


2,455

(81)

-

2,374


(3)












OPERATING INCOME

180


40

98

-

138


30












Gains and other income (including gain on debt extinguishment of $21 for the twelve weeks ended March 27, 2009) 6

1


25

-

-

25


(96)


Interest expense

(45)


(29)

-

-

(29)


(55)


Interest income

4


6

-

-

6


(33)


Equity in (losses) earnings 7

(11)


(34)

31

-

(3)


(267)












INCOME BEFORE INCOME TAXES

129


8

129

-

137


(6)












Provision for income taxes

(46)


(33)

(45)

26

(52)


12












NET INCOME / (LOSS)

83


(25)

84

26

85


(2)












Add: Net losses attributable to noncontrolling interests, net of tax

-


2

-

-

2


(100)












NET INCOME / (LOSS) ATTRIBUTABLE TO MARRIOTT

$                   83


$                  (23)

$                  84

$          26

$                      87


(5)












EARNINGS / (LOSSES) PER SHARE - Basic 8




















  Earnings / (losses) per share attributable to Marriott shareholders 9

$                0.23


$               (0.06)

$               0.24

$       0.07

$                   0.25


(8)












EARNINGS / (LOSSES) PER SHARE - Diluted 8




















  Earnings / (losses) per share attributable to Marriott shareholders 9

$                0.22


$               (0.06)

$               0.24

$       0.07

$                   0.24


(8)












Basic Shares 8

359.4


354.4

354.4

354.4

354.4




Diluted Shares 8,10

373.3


354.4

354.4

354.4

360.5






** Denotes non-GAAP financial measures.  Please see pages A-19 and A-20 for additional information about our reasons for providing these alternative financial measures and the limitations on their use.


See page A-2 for footnote references.













1 - Owned, leased, corporate housing and other revenue includes revenue from the properties we own or lease, revenue from our corporate housing business, termination fees and other revenue.

2 - Timeshare sales and services includes total timeshare revenue except for base management fees and cost reimbursements.

3 - Cost reimbursements include reimbursements from properties for Marriott-funded operating expenses.

4 - Owned, leased and corporate housing - direct expenses include operating expenses related to our owned or leased hotels, including lease payments, pre-opening expenses and depreciation, plus expenses related to our corporate housing business.

5 - General, administrative and other expenses include the overhead costs allocated to our segments and our corporate overhead costs and general expenses.

6 - Gains and other income includes gains and losses on: the sale of real estate; note sales or repayments (except timeshare note securitizations); the sale of joint ventures and investments; and debt extinguishments, as well as income from cost method joint ventures.

7 - Equity in (losses) earnings includes our equity in (losses) / earnings of unconsolidated equity method joint ventures.

8 - 2009 share numbers and per share amounts have been retroactively adjusted to reflect the stock dividends with distribution dates of July 30, 2009, September 3, 2009 and December 3, 2009.

9 - Earnings / (Losses) per share attributable to Marriott shareholders plus adjustment items may not equal earnings per share attributable to Marriott shareholders as adjusted due to rounding.

10 - Basic and fully diluted weighted average common shares outstanding used to calculate earnings per share from continuing operations for the periods in which we had a loss are the same because inclusion of additional equivalents would be anti-dilutive.

A-2

MARRIOTT INTERNATIONAL, INC.


TOTAL LODGING PRODUCTS 1






























Number of Properties


Number of Rooms/Suites


Brand

March 26, 2010

March 27, 2009

vs. March 27, 2009


March 26, 2010

March 27, 2009

vs. March 27, 2009











Domestic Full-Service









   Marriott Hotels & Resorts

356

349

7


142,282

138,931

3,351


   Renaissance Hotels

79

76

3


28,914

28,047

867


   Autograph

2

-

2


242

-

242


Domestic Limited-Service









   Courtyard

775

738

37


108,858

103,042

5,816


   Fairfield Inn & Suites

632

574

58


56,948

51,052

5,896


   SpringHill Suites

260

217

43


30,484

25,128

5,356


   Residence Inn

588

558

30


70,723

66,730

3,993


   TownePlace Suites

187

166

21


18,759

16,643

2,116


International









   Marriott Hotels & Resorts

194

185

9


59,641

55,740

3,901


   Renaissance Hotels

66

66

-


21,992

22,536

(544)


   Courtyard

93

83

10


18,185

16,222

1,963


   Fairfield Inn & Suites

9

9

-


1,109

1,109

-


   SpringHill Suites

1

1

-


124

124

-


   Residence Inn

17

16

1


2,418

2,389

29


   Marriott Executive Apartments

23

21

2


3,903

3,337

566


Luxury









   The Ritz-Carlton - Domestic

40

37

3


12,120

11,652

468


   The Ritz-Carlton - International

34

34

-


10,171

10,477

(306)


   Bulgari Hotels & Resorts

2

2

-


117

117

-


   The Ritz-Carlton Residential

26

24

2


2,669

2,539

130


   The Ritz-Carlton Serviced Apartments

3

3

-


458

478

(20)


Timeshare 2









   Marriott Vacation Club 3

53

51

2


11,874

11,803

71


   The Ritz-Carlton Destination Club

9

10

(1)


464

456

8


   The Ritz-Carlton Residences

4

3

1


238

149

89


   Grand Residences by Marriott - Fractional

2

2

-


248

241

7


   Grand Residences by Marriott - Residential

2

2

-


68

91

(23)


Sub Total Timeshare

70

68

2


12,892

12,740

152











Total

3,457

3,227

230


603,009

569,033

33,976












A-3

Number of Timeshare Interval, Fractional and Residential Resorts



Total

Properties in



Properties 2

Active Sales 4


100% Company-Developed




   Marriott Vacation Club 3

53

30


   The Ritz-Carlton Destination Club and Residences

9

8


   Grand Residences by Marriott and Residences

4

4






Joint Ventures




   The Ritz-Carlton Destination Club and Residences

4

4






Total  

70

46










1 Total Lodging Products excludes the 1,781 and 2,157 corporate housing rental units as of March 26, 2010 and March 27, 2009, respectively.


2 Includes products that are in active sales as well as those that are sold out.  Residential products are included once they possess a certificate of occupancy.


3 Marriott Vacation Club includes Horizons by Marriott Vacation Club products that were previously reported separately.  


4 Products in active sales may not be ready for occupancy.









MARRIOTT INTERNATIONAL INC.

KEY LODGING STATISTICS

Constant $


Comparable Company-Operated International Properties1





Two Months Ended February 28, 2010 and February 28, 2009



REVPAR


Occupancy


Average Daily Rate


Region

2010

vs. 2009


2010


vs. 2009


2010

vs. 2009


Caribbean & Latin America

$145.17

-3.0%


73.4%

4.0%

pts.


$197.68

-8.3%


Continental Europe

$90.47

1.5%


57.2%

4.8%

pts.


$158.20

-7.0%


United Kingdom

$103.06

6.0%


66.4%

4.4%

pts.


$155.19

-1.1%


Middle East & Africa

$92.29

-11.6%


67.6%

1.5%

pts.


$136.58

-13.6%


Asia Pacific2

$72.52

15.8%


60.2%

12.5%

pts.


$120.42

-8.3%













Regional Composite3

$96.54

2.1%


63.6%

6.4%

pts.


$151.73

-8.3%













International Luxury4

$188.74

-0.7%


58.5%

3.6%

pts.


$322.47

-6.8%













Total International5

$106.72

1.5%


63.1%

6.1%

pts.


$169.23

-8.3%













Worldwide6

$94.13

-1.0%


64.1%

4.6%

pts.


$146.86

-8.1%
















Comparable Systemwide International Properties1





Two Months Ended February 28, 2010 and February 28, 2009



REVPAR


Occupancy


Average Daily Rate


Region

2010

vs. 2009


2010


vs. 2009


2010

vs. 2009


Caribbean & Latin America

$120.01

1.8%


67.4%

6.4%

pts.


$178.11

-7.9%


Continental Europe

$87.50

0.4%


56.1%

4.8%

pts.


$156.03

-8.1%


United Kingdom

$101.29

5.6%


65.6%

4.3%

pts.


$154.36

-1.2%


Middle East & Africa

$92.29

-11.6%


67.6%

1.5%

pts.


$136.58

-13.6%


Asia Pacific2

$76.86

8.2%


60.8%

10.6%

pts.


$126.47

-10.6%













Regional Composite3

$93.73

1.6%


62.3%

6.3%

pts.


$150.52

-8.6%













International Luxury4

$188.74

-0.7%


58.5%

3.6%

pts.


$322.47

-6.8%













Total International5

$102.35

1.2%


61.9%

6.0%

pts.


$165.25

-8.7%













Worldwide6

$78.93

-1.3%


62.9%

3.6%

pts.


$125.48

-6.9%
























1  We report International results on a period basis, and international statistics on a monthly basis.  Statistics are in constant dollars for January through February.  International includes properties located outside the Continental United States and Canada, except for Worldwide which also includes North America.


2  Does not include Hawaii.


3  Regional information includes the Marriott Hotels & Resorts, Renaissance Hotels and Courtyard brands.


  Includes Hawaii.


4  International Luxury includes The Ritz-Carlton properties outside of North America and Bulgari Hotels & Resorts.


5  Includes Regional Composite and International Luxury.


6   Includes international statistics for the two calendar months ended February 28, 2010 and February 28, 2009, and North American statistics for the twelve weeks ended March 26, 2010 and March 27, 2009.  Includes the Marriott Hotels &   Resorts, Renaissance Hotels, The Ritz-Carlton, Bulgari Hotels & Resorts, Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites and SpringHill Suites brands.














A-4

MARRIOTT INTERNATIONAL INC.

KEY LODGING STATISTICS


Comparable Company-Operated North American Properties1





Twelve Weeks Ended March 26, 2010 and March 27, 2009



REVPAR


Occupancy


Average Daily Rate


Brand

2010

vs. 2009


2010


vs. 2009


2010

vs. 2009


Marriott Hotels & Resorts

$101.05

-1.2%


66.2%

4.4%

pts.


$152.59

-7.7%


Renaissance Hotels

$96.04

-4.6%


63.9%

3.3%

pts.


$150.21

-9.6%


Composite North American Full-Service2

$100.12

-1.8%


65.8%

4.2%

pts.


$152.16

-8.0%


The Ritz-Carlton3

$193.68

2.5%


64.2%

6.8%

pts.


$301.74

-8.4%


Composite North American Full-Service & Luxury4

$107.58

-1.2%


65.7%

4.4%

pts.


$163.82

-7.8%


Residence Inn

$78.90

-0.9%


69.4%

5.3%

pts.


$113.69

-8.4%


Courtyard

$64.74

-4.1%


60.3%

3.6%

pts.


$107.29

-9.9%


TownePlace Suites

$43.32

-11.2%


58.0%

1.0%

pts.


$74.67

-12.7%


SpringHill Suites

$58.16

-2.3%


59.8%

4.0%

pts.


$97.22

-8.9%


Composite North American Limited-Service5

$66.83

-3.3%


62.7%

3.9%

pts.


$106.64

-9.3%


Composite - All6

$90.36

-1.9%


64.4%

4.2%

pts.


$140.30

-8.2%














Click to view table full screen

Comparable Systemwide North American Properties1














Twelve Weeks Ended March 26, 2010 and March 27, 2009



REVPAR


Occupancy


Average Daily Rate


Brand

2010

vs. 2009


2010


vs. 2009


2010

vs. 2009


Marriott Hotels & Resorts

$89.79

-1.0%


63.5%

3.9%

pts.


$141.50

-7.1%


Renaissance Hotels

$87.78

-2.2%


63.6%

4.7%

pts.


$138.12

-9.5%


Composite North American Full-Service2

$89.43

-1.2%


63.5%

4.1%

pts.


$140.90

-7.6%


The Ritz-Carlton3

$193.68

2.5%


64.2%

6.8%

pts.


$301.74

-8.4%


Composite North American Full-Service & Luxury4

$94.31

-0.9%


63.5%

4.2%

pts.


$148.52

-7.4%


Residence Inn

$78.22

-0.8%


70.6%

4.3%

pts.


$110.80

-6.8%


Courtyard

$66.99

-2.9%


61.4%

2.4%

pts.


$109.16

-6.7%


Fairfield Inn & Suites

$46.59

-3.9%


56.4%

0.9%

pts.


$82.66

-5.4%


TownePlace Suites

$49.27

-4.5%


61.3%

3.4%

pts.


$80.33

-9.7%


SpringHill Suites

$58.95

-4.4%


61.1%

2.6%

pts.


$96.55

-8.5%


Composite North American Limited-Service5

$64.15

-2.6%


62.8%

2.7%

pts.


$102.22

-6.7%


Composite - All6

$75.63

-1.8%


63.0%

3.3%

pts.


$119.96

-6.8%
























1 North America includes properties located in the Continental United States and Canada.


2 Includes the Marriott Hotels & Resorts and Renaissance Hotels brands.


3 Statistics for The Ritz-Carlton are for January through February.


4 Includes the Marriott Hotels & Resorts, Renaissance Hotels and The Ritz-Carlton brands.


5 Includes the Residence Inn, Courtyard, Fairfield Inn & Suites, TownePlace Suites and SpringHill Suites brands.


6 Includes the Marriott Hotels & Resorts, Renaissance Hotels, The Ritz-Carlton, Residence Inn, Courtyard,


 Fairfield Inn & Suites, TownePlace Suites, and SpringHill Suites brands.














A-5

Click to view table full screen

MARRIOTT INTERNATIONAL, INC.


TIMESHARE SEGMENT


($ in millions)






















Adjustments








As Reported 
12 Weeks Ended 
March 26, 2010


As Reported 
12 Weeks Ended 
March 27, 2009


Restructuring 
Costs & Other 
Charges


Timeshare Strategy - Impairment Charges


As Adjusted 
12 Weeks Ended 
March 27, 2009**


Percent
Better/(Worse)
2010 vs.
Adjusted 2009



Segment Revenues














Base fees revenue

$                       11


$                       10


$                                     -


$                                  -


$                       10


10



Sales and services revenue














Development

147


121


4


-


125


18



Services

83


70


-


-


70


19



Financing revenue














Interest income - non-securitized notes

9


13


-


-


13


(31)



Interest income - securitized notes

36


-


-


-


-


*



Other financing revenue 1

5


-


13


-


13


(62)



Total financing revenue

50


13


13


-


26


92



Other revenue

5


5


-


-


5


-



Total sales and services revenue

285


209


17


-


226


26



Cost reimbursements

62


58


-


-


58


7



Segment revenues

$                     358


$                     277


$                                  17


$                                  -


$                     294


22































Segment Results














Base fees revenue

$                       11


$                       10


$                                     -


$                                  -


$                       10


10



Timeshare sales and services, net

50


(11)


16


-


5


900



Timeshare strategy - impairment














    charges

-


-


-


-


-


-



Restructuring costs

-


(1)


1


-


-


-



General, administrative and other














    expense

(17)


(17)


-


-


(17)


-



Gains and other income

-


-


-


-


-


-



Joint venture equity earnings

(5)


(1)


1


-


-


*



Interest expense

(14)


-


-


-


-


*



Timeshare strategy - impairment














   charges (non-operating)

-


-


-


-


-


-



Noncontrolling interest

-


3


-


-


3


(100)



Segment results

$                       25


$                     (17)


$                                  18


$                                  -


$                         1


2,400













































Contract Sales














Company:














Timeshare

$                     151


$                     138


$                                     -


$                                  -


$                     138


9



Fractional

8


10


-


-


10


(20)



Residential

4


(5)


4


-


(1)


(500)



   Total company

163


143


4


-


147


11



Joint ventures:














Timeshare

-


-


-


-


-


-



Fractional

1


13


(3)


-


10


(90)



Residential

-


(27)


27


-


-


-



   Total joint ventures

1


(14)


24


-


10


(90)



Total contract sales 2

$                     164


$                     129


$                                  28


$                                  -


$                     157


4






























 *  Percent cannot be calculated.  


 **Denotes non-GAAP financial measures.  Please see pages A-19 and A-20 for additional information about our reasons for providing these alternative financial measures and the limitations on their use.  




 1  As Reported 12 Weeks Ended March 27, 2009 and As Adjusted 12 Weeks Ended March 27, 2009 include gain/(loss) on notes sold of ($1) million and ($1) million, respectively.  


 2  As Reported 12 Weeks Ended March 26, 2010 includes fractional and residential contract cancellation allowances of ($4) million and ($4) million, respectively.  Gross contract sales for the 2010 first quarter were $172 million before the contract cancellation reserves of $8 million.  

















A-6

MARRIOTT INTERNATIONAL, INC.


Non-GAAP Financial Measure


EBITDA and Adjusted EBITDA


($ in millions)








Fiscal Year 2010



First Quarter


Net Income attributable to Marriott

$                83


Interest expense

45


Tax provision

46


Tax provision, noncontrolling interest

-


Depreciation and amortization

39


Less: Depreciation reimbursed by third-party owners

(3)


Interest expense from unconsolidated joint ventures

5


Depreciation and amortization from unconsolidated joint ventures

6


EBITDA **

221





Increase over 2009 Adjusted EBITDA

3%






Click to view table full screen

Fiscal Year 2009



First 
Quarter


Second 
Quarter


Third 
Quarter


Fourth 
Quarter


Total


Net Income / (Loss) attributable to Marriott

$              (23)


$      37


$   (466)


$    106


$ (346)


Interest expense

29


28


27


34


118


Tax provision

33


44


(210)


68


(65)


Tax provision, noncontrolling interest

1


2


1


-


4


Depreciation and amortization

39


42


43


61


185


Less: Depreciation reimbursed by third-party owners

(2)


(2)


(2)


(3)


(9)


Interest expense from unconsolidated joint ventures

3


6


4


6


19


Depreciation and amortization from unconsolidated joint ventures

6


6


6


9


27


EBITDA **

86


163


(597)


281


(67)













Restructuring costs and other charges











      Severance

2


10


4


5


21


      Facilities exit costs

-


22


5


2


29


      Development cancellations

-


1


-


-


1


         Total restructuring costs

2


33


9


7


51


      Impairment of investments and other, net of prior year reserves

68


3


1


11


83


      Reserves for loan losses

42


1


-


-


43


      Contract cancellation allowances

4


1


1


3


9


      Residual interests valuation

13


12


(3)


(2)


20


      System development write-off

-


7


-


-


7


         Total other charges

127


24


(1)


12


162


Total restructuring costs and other charges

129


57


8


19


213













Timeshare strategy - impairment charges











      Operating impairments

-


-


614


-


614


      Non-operating impairments

-


-


138


-


138


Total timeshare strategy - impairment charges

-


-


752


-


752













Adjusted EBITDA **

$              215


$    220


$    163


$    300


$  898













** Denotes non-GAAP financial measures.  Please see pages A-19 and A-20 for additional information about our reasons for providing these alternative financialmeasures and the limitations on their use.














A-7

MARRIOTT INTERNATIONAL, INC.


Non-GAAP Financial Measure


Total Debt


($ in millions)




















Balance at
End of 2010 
First Quarter


Balance at
Year-End
2009


Better/
(Worse)
Change


Total debt

$           3,269


$      2,298


$                (971)


Less the impact of ASU Nos. 2009-16 and 2009-17

(1,043)


-


1,043


Adjusted total debt** (a)

$           2,226


$      2,298


$                   72










Click to view table full screen

Range


Range



Estimated Balance


Estimated Balance


As Compared to Balance
at Year-End 2009



Year-End 
2010 (b)


Year-End
2010 (c)


Better/(Worse)
Change (b)


Better/(Worse)
Change (c)


Total debt

$           2,854


$      2,754


$                (556)


$                (456)


Less the impact of ASU Nos. 2009-16 and 2009-17

(956)


(956)


956


956


Adjusted total debt** (a)

$           1,898


$      1,798


$                 400


$                 500






























(a) Excludes the impact of the update to ASU Nos. 2009-16 and 2009-17.


(b) Assumes $400 debt repayment in 2010.


(c) Assumes $500 debt repayment in 2010.


**Denotes non-GAAP financial measures.  Please see pages A-19 and A-20 for additional information about our reasons












A-8

Click to view table full screen

MARRIOTT INTERNATIONAL, INC.


Non-GAAP Financial Measure


Revenue, Interest Expense and Income Before Income Taxes


As Adjusted Had ASU Nos. 2009-16 and 2009-17 (Formerly Referred to as FAS 166 & 167) Been Adopted on January 3, 2009


First Quarter 2009


($ in millions)




























First Quarter 
2009 
As Reported


First Quarter
2009
Restructuring Costs and Other Charges


First Quarter 
2009 
As Adjusted For Restructuring Costs and Other Charges**


ASU Nos. 
2009-16 and 
2009-17 
Adjustments


First Quarter 
2009
As Adjusted For 
ASU Nos. 2009-16 
and 2009-17**













Revenue

$           2,495


$                                       17


$                         2,512


$                28


$                  2,540



































Interest Expense

$              (29)


$                                          -


$                             (29)


$               (16)


$                      (45)



































Income Before 
Income Taxes

$                  8


$                                     129


$                            137


$                  4


$                     141



































** Denotes non-GAAP financial measures.  Please see pages A-19 and A-20 for additional information about our reasons for providing these alternative financial measures and the limitations on their use.
















A-9

Click to view table full screen

MARRIOTT INTERNATIONAL, INC.