Marriott Records Quarterly Profit
Hotel operator Marriott International Inc has recorded a quarterly profit, compared to a year-ago loss, as a recovery in travel began to aid a battered global tourist industry.
Marriott's net profit was $422 million, or $1.28 per share, in the second quarter ended June 30, compared with a loss of $234 million, or 72 cents per share, a year earlier.
Marriott acknowledged that the Delta variant had stalled recovery in Asia Pacific in the second quarter and said it would remain watchful of any further impact on a recovery in hotel occupancy.
Shares of the world's largest hotel chain, which posted a profit beat, were down 1.9% as the broader market also fell due to worries over the Delta variant, which was first detected in India.
Marriott said recovery in its Asia Pacific region, excluding China, stalled in the quarter before picking up pace, as some countries imposed lockdowns due to a rise in infections.
The hotel operator continues to struggle to fill up rooms, with occupancy remaining well below the rates seen before the pandemic but recovering from last year's lows.
"We will continue to be vigilant as we watch the pace of vaccinations around the world, the effectiveness of those vaccinations relative to the Delta variant" Marriott Chief Executive Anthony Capuano said.
Delta is as contagious as chickenpox and far more contagious than the common cold or flu. It now comprises more than 80% of new cases nationwide and has been detected in more than 90 countries.
Marriott, which owns the hotel brand Ritz-Carlton, said second-quarter occupancy in its key U.S. & Canada and Greater China markets rose to 56.1% and 62.4%, respectively, compared to 19.6% and 35.5% a year earlier.
Comparable RevPAR – a key performance measure – fell 43.8% during the quarter, compared to the second-quarter of 2019.
Shares of rivals Hilton and Hyatt also slumped 2.7% and 2.8%, respectively.
Excluding items, Marriott earned 79 cents per share, versus analysts' average estimate of 45 cents per share, according to IBES data from Refinitiv.
Revenue rose 115.1% to $3.15 billion, but fell short of expectations of $3.21 billion.