Fourth quarter 2023 comparable systemwide constant dollar RevPAR increased 7.2 percent worldwide, 3.3 percent in the U.S. & Canada, and 17.4 percent in international markets, compared to the 2022 fourth quarter;
Fourth quarter reported diluted EPS totaled $2.87, compared to reported diluted EPS of $2.12 in the year-ago quarter. Fourth quarter adjusted diluted EPS totaled $3.57, compared to fourth quarter 2022 adjusted diluted EPS of $1.96;
Fourth quarter reported net income totaled $848 million, compared to reported net income of $673 million in the year-ago quarter. Fourth quarter adjusted net income totaled $1,055 million, compared to fourth quarter 2022 adjusted net income of $622 million;
Adjusted EBITDA totaled $1,197 million in the 2023 fourth quarter, compared to fourth quarter 2022 adjusted EBITDA of $1,090 million;
The company added nearly 81,300 rooms globally during 2023, including approximately 17,500 rooms associated with the City Express transaction and more than 43,000 other rooms in international markets. Net rooms grew 4.7 percent from year-end 2022;
At the end of the year, Marriott’s worldwide development pipeline totaled nearly 3,400 properties and roughly 573,000 rooms, including over 21,000 pipeline rooms approved, but not yet subject to signed contracts. More than 232,000 rooms in the pipeline were under construction as of the end of 2023;
For full year 2023, Marriott repurchased 21.5 million shares of common stock for $3.9 billion, including 4.7 million shares for $965 million in the fourth quarter. The company returned over $4.5 billion to shareholders through dividends and share repurchases in 2023.
BETHESDA, Md., Feb. 13, 2024 /PRNewswire/ — Marriott International, Inc. (NASDAQ:MAR) today reported fourth quarter and full year 2023 results.
Anthony Capuano, President and Chief Executive Officer, said, “Our team delivered excellent results in 2023, as demand for our industry leading portfolio of properties and offerings around the world continued to grow. Full year global RevPAR1 rose 15 percent, net rooms grew 4.7 percent, and our fee-driven, asset-light business model generated record levels of cash.
“In the fourth quarter, worldwide RevPAR rose 7 percent. International RevPAR grew 17 percent, with particular strength in Asia Pacific and Europe.
“In the U.S. & Canada, fourth quarter RevPAR rose over 3 percent. Group revenue at our hotels increased 7 percent compared to the 2022 fourth quarter, driven by solid rate increases. While already significantly above 2019 levels, hotel leisure revenue rose again, up 2 percent. Business transient revenue at our hotels grew 3 percent from the year-ago quarter, with demand from large corporate customers continuing to make gains.
“Our development team had a stellar 2023, signing a record 164,000 organic rooms globally, including 37,000 rooms from our deal with MGM Resorts International, and our development pipeline reached a new high of roughly 573,000 rooms at year end. During the year, we added nearly 81,300 rooms to our distribution, with one in four organic rooms from conversions.
“The power of our unparalleled Marriott Bonvoy loyalty program continues to increase, with 196 million members at year end. We’ve continued to leverage our global portfolio and have expanded our co-brand credit card offerings, with 31 cards now across 11 countries. In 2023, global card spend increased a remarkable 11 percent over the prior year.
“In 2024, we expect another year of solid growth and significant shareholder returns. With normalizing RevPAR growth around the world, we anticipate a worldwide full year RevPAR increase of 3 to 5 percent and net rooms growth of 5.5 to 6 percent. We expect this should yield adjusted EBITDA of approximately $4.9 billion to $5.0 billion for the year and enable us to return $4.1 billion to $4.3 billion to shareholders after factoring in $500 million to purchase the Sheraton Grand Chicago.”
Fourth Quarter 2023 Results
Base management and franchise fees totaled $1,026 million in the 2023 fourth quarter, a 9 percent increase compared to base management and franchise fees of $945 million in the year-ago quarter. The increase is primarily attributable to RevPAR increases and unit growth. Non-RevPAR-related franchise fees in the 2023 fourth quarter totaled $220 million, compared to $215 million in the year-ago quarter. The increase was largely driven by higher co-brand credit card fees.
Incentive management fees totaled $218 million in the 2023 fourth quarter, a 17 percent increase compared to $186 million in the 2022 fourth quarter. Managed hotels in international markets contributed two-thirds of the incentive fees earned in the quarter.
Owned, leased, and other revenue, net of direct expenses, totaled $151 million in the 2023 fourth quarter, compared to $101 million in the year-ago quarter. Results in the 2023 quarter included a $63 million ($47 million after-tax and $0.16 per share) termination fee related to a development project.
General, administrative, and other expenses for the 2023 fourth quarter totaled $330 million, compared to $236 million in the year-ago quarter. The year-over-year change reflects a $27 million ($20 million after-tax and $0.07 per share) litigation reserve related to an international hotel, as well as higher performance-related compensation expenses, professional fees, and bad debt reserves.
Interest expense, net, totaled $144 million in the 2023 fourth quarter, compared to $107 million in the year-ago quarter. The increase was largely due to higher interest expense associated with higher debt balances.
In the 2023 fourth quarter, the provision for income taxes totaled a $267 million benefit, compared to a $218 million expense in the 2022 fourth quarter. The favorable year-over-year change is primarily due to international intellectual property restructuring transactions completed in the quarter resulting in $228 million ($0.77 per share) of benefits and a $223 million ($0.75 per share) favorable impact from the release of a tax valuation allowance.
Marriott’s reported operating income totaled $718 million in the 2023 fourth quarter, compared to 2022 fourth quarter reported operating income of $996 million. Reported net income totaled $848 million in the 2023 fourth quarter, a 26 percent increase compared to 2022 fourth quarter reported net income of $673 million. Reported diluted earnings per share (EPS) totaled $2.87 in the quarter, compared to reported diluted EPS of $2.12 in the year-ago quarter.
Adjusted operating income in the 2023 fourth quarter totaled $992 million, compared to 2022 fourth quarter adjusted operating income of $926 million. Fourth quarter 2023 adjusted net income totaled $1,055 million, compared to 2022 fourth quarter adjusted net income of $622 million. Adjusted diluted EPS in the 2023 fourth quarter totaled $3.57, compared to adjusted diluted EPS of $1.96 in the year-ago quarter.
Adjusted results excluded cost reimbursement revenue, reimbursed expenses and merger-related charges and other expenses. See pages A-3 and A-11 for the calculation of adjusted results and the manner in which the adjusted measures are determined in this press release.
Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) totaled $1,197 million in the 2023 fourth quarter, a 10 percent increase compared to fourth quarter 2022 adjusted EBITDA of $1,090 million. See page A-11 for the adjusted EBITDA calculation.
Selected Performance Information
Marriott added 558 properties (81,281 rooms) to its worldwide portfolio during 2023, including approximately 17,500 rooms associated with the City Express transaction and more than 43,000 other rooms in international markets. Sixty-three properties (9,430 rooms) exited the system during the year. At the end of the year, Marriott’s global system totaled nearly 8,800 properties, with more than 1,597,000 rooms.
At the end of the year, the company’s worldwide development pipeline totaled 3,379 properties with roughly 573,000 rooms, including 126 properties with over 21,000 rooms approved for development, but not yet subject to signed contracts. The year-end pipeline included 1,066 properties with more than 232,000 rooms under construction, or 41 percent, including approximately 37,000 rooms from the MGM deal.
In the 2023 fourth quarter, worldwide RevPAR increased 7.2 percent (a 7.6 percent increase using actual dollars) compared to the 2022 fourth quarter. RevPAR in the U.S. & Canada increased 3.3 percent (a 3.3 percent increase using actual dollars), and RevPAR in international markets increased 17.4 percent (an 18.7 percent increase using actual dollars).
Balance Sheet & Common Stock
At year-end 2023, Marriott’s total debt was $11.9 billion and cash and equivalents totaled $0.3 billion, compared to $10.1 billion in debt and $0.5 billion of cash and equivalents at year-end 2022.
The company repurchased 4.7 million shares of common stock in the 2023 fourth quarter for $965 million. For full year 2023, Marriott repurchased 21.5 million shares for $3.9 billion. Year to date through February 9, the company has repurchased 1.3 million shares for $300 million.
Company Outlook
First Quarter 2024
vs First Quarter 2023
Full Year 2024
vs Full Year 2023
Comparable systemwide constant $
RevPAR growth
Worldwide
4% to 5%
3% to 5%
Year-End 2024
vs Year-End 2023
Net rooms growth
5.5% to 6%
($ in millions, except EPS)
First Quarter 2024
Full Year 2024
Gross fee revenues
$1,190 to $1,205
$5,120 to $5,220
Owned, leased, and other revenue, net of direct expenses
$65 to $70
$320 to $330
General, administrative, and other expenses
$245 to $235
$1,035 to $1,015
Adjusted EBITDA1,2
$1,120 to $1,150
$4,880 to $5,010
Adjusted EPS – diluted2,3
$2.12 to $2.19
$9.18 to $9.52
Investment spending4
$1,000 to $1,200
Capital return to shareholders5
$4,100 to $4,300
1See pages A-12 and A-13 for the adjusted EBITDA calculations.
2Adjusted EBITDA and Adjusted EPS – diluted for first quarter and full year 2024 do not include cost reimbursement revenue, reimbursed expenses, merger-related charges and other expenses, or any asset sales that may occur during the year, each of which the company cannot forecast with sufficient accuracy and without unreasonable efforts, and which may be significant.
3Assumes the level of capital return to shareholders noted above.
4Includes capital and technology expenditures, loan advances, contract acquisition costs, and other investing activities.
5Factors in the purchase of the Sheraton Grand Chicago and underlying land for $500 million, $200 million of which is included in investment spending. Assumes the level of investment spending noted above and that no asset sales occur during the year.
Marriott International, Inc. (NASDAQ:MAR) will conduct its quarterly earnings review for the investment community and news media on Tuesday, February 13, 2024, at 8:30 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 on “Events & Presentations” and click on the quarterly conference call link. A replay will be available at that same website until February 13, 2025.
The telephone dial-in number for the conference call is US Toll Free: 800-245-3047, or Global: +1 203-518-9765. The conference ID is MAR4Q23. A telephone replay of the conference call will be available from 1:00 p.m. ET, Tuesday, February 13, 2024, until 8:00 p.m. ET, Tuesday, February 20, 2024. To access the replay, call US Toll Free: 800-934-2730 or Global: +1 402-220-1141.
Note on forward-looking statements: All statements in this press release and the accompanying schedules are made as of February 13, 2024. We undertake no obligation to publicly update or revise these statements, whether as a result of new information, future events or otherwise. This press release and the accompanying schedules contain “forward-looking statements” within the meaning of federal securities laws, including statements related to our RevPAR, rooms growth and other financial metric estimates, outlook and assumptions; shareholder returns; travel and lodging demand trends and expectations; our development pipeline and growth expectations; 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 evolving risks and uncertainties that we may not be able to accurately predict or assess, including the risk factors that we describe in our Securities and Exchange Commission filings, including our most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q. Any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release.
Marriott International, Inc. (NASDAQ:MAR) is based in Bethesda, Maryland, USA, and encompasses a portfolio of nearly 8,800 properties across more than 30 leading brands in 139 countries and territories. Marriott operates and franchises hotels and licenses vacation ownership resorts all around the world. The company offers Marriott Bonvoy®, its highly awarded travel program. For more information, please visit our website at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com. In addition, connect with us on Facebook and @MarriottIntl on X and Instagram.
Marriott encourages investors, the media, and others interested in the company to review and subscribe to the information Marriott posts on its investor relations website at www.marriott.com/investor or Marriott’s news center website at www.marriottnewscenter.com, which may be material. The contents of these websites are not incorporated by reference into this press release or any report or document Marriott files with the SEC, and any references to the websites are intended to be inactive textual references only.
IRPR#1
Tables follow
1 All occupancy, Average Daily Rate (ADR), RevPAR and hotel revenue statistics and estimates are systemwide constant dollar. Unless otherwise stated, all changes refer to year-over-year changes for the comparable period. Occupancy, ADR, RevPAR and hotel revenue comparisons between 2023 and 2022 reflect properties that are comparable in both years.
MARRIOTT INTERNATIONAL, INC.
PRESS RELEASE SCHEDULES
TABLE OF CONTENTS
QUARTER 4, 2023
Consolidated Statements of Income – As Reported
A-1
Non-GAAP Financial Measures
A-3
Total Lodging Products by Ownership Type
A-4
Total Lodging Products by Tier
A-6
Key Lodging Statistics
A-7
Adjusted EBITDA
A-11
Adjusted EBITDA Forecast – First Quarter 2024
A-12
Adjusted EBITDA Forecast – Full Year 2024
A-13
Explanation of Non-GAAP Financial and Performance Measures
A-14
MARRIOTT INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF INCOME – AS REPORTED
FOURTH QUARTER 2023 AND 2022
(in millions except per share amounts, unaudited)
As Reported
As Reported
Percent
Three Months Ended
Three Months Ended
Better/(Worse)
December 31, 2023
December 31, 2022
Reported 2023 vs. 2022
REVENUES
Base management fees
$ 321
$ 287
12
Franchise fees 1
705
658
7
Incentive management fees
218
186
17
Gross Fee Revenues
1,244
1,131
10
Contract investment amortization 2
(22)
(24)
8
Net Fee Revenues
1,222
1,107
10
Owned, leased, and other revenue 3
455
396
15
Cost reimbursement revenue 4
4,418
4,420
–
Total Revenues
6,095
5,923
3
OPERATING COSTS AND EXPENSES
Owned, leased, and other – direct 5
304
295
(3)
Depreciation, amortization, and other 6
51
46
(11)
General, administrative, and other 7
330
236
(40)
Merger-related charges and other
8
1
(700)
Reimbursed expenses 4
4,684
4,349
(8)
Total Expenses
5,377
4,927
(9)
OPERATING INCOME
718
996
(28)
Gains and other income, net 8
7
2
250
Interest expense
(153)
(115)
(33)
Interest income
9
8
13
Equity in earnings 9
–
–
–
INCOME BEFORE INCOME TAXES
581
891
(35)
Benefit (provision) for income taxes
267
(218)
222
NET INCOME
$ 848
$ 673
26
EARNINGS PER SHARE
Earnings per share – basic
$ 2.88
$ 2.13
35
Earnings per share – diluted
$ 2.87
$ 2.12
35
Basic Shares
294.3
316.5
Diluted Shares
295.6
317.9
1
Franchise fees include fees from our franchise agreements, application and relicensing fees, timeshare and yacht fees, co-branded credit card fees, and
residential branding fees.
2
Contract investment amortization includes amortization of capitalized costs to obtain contracts with our owner and franchisee customers, and any related
impairments, accelerations, or write-offs.
3
Owned, leased, and other revenue includes revenue from the properties we own or lease, termination fees, and other revenue.
4
Cost reimbursement revenue includes reimbursements from properties for property-level and centralized programs and services that we operate for the benefit of
our hotel owners. Reimbursed expenses include costs incurred by Marriott for certain property-level operating expenses and centralized programs and services.
5
Owned, leased, and other – direct expenses include operating expenses related to our owned or leased hotels, including lease payments and pre-opening expenses.
6
Depreciation, amortization, and other expenses include depreciation for fixed assets, amortization of capitalized costs incurred to acquire management, franchise,
and license agreements, and any related impairments, accelerations, or write-offs.
7
General, administrative, and other expenses include our corporate and business segments overhead costs and general expenses.
8
Gains and other income, net includes gains and losses on the sale of real estate, the sale of joint venture interests and other investments, and adjustments from
other equity investments.
9
Equity in earnings include our equity in earnings or losses of unconsolidated equity method investments.
MARRIOTT INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF INCOME – AS REPORTED
FULL YEAR 2023 AND 2022
(in millions except per share amounts, unaudited)
As Reported
As Reported
Percent
Twelve Months Ended
Twelve Months Ended
Better/(Worse)
December 31, 2023
December 31, 2022
Reported 2023 vs. 2022
REVENUES
Base management fees
$ 1,238
$ 1,044
19
Franchise fees 1
2,831
2,505
13
Incentive management fees
755
529
43
Gross Fee Revenues
4,824
4,078
18
Contract investment amortization 2
(88)
(89)
1
Net Fee Revenues
4,736
3,989
19
Owned, leased, and other revenue 3
1,564
1,367
14
Cost reimbursement revenue 4
17,413
15,417
13
Total Revenues
23,713
20,773
14
OPERATING COSTS AND EXPENSES
Owned, leased, and other – direct 5
1,165
1,074
(8)
Depreciation, amortization, and other 6
189
193
2
General, administrative, and other 7
1,011
891
(13)
Merger-related charges and other
60
12
(400)
Reimbursed expenses 4
17,424
15,141
(15)
Total Expenses
19,849
17,311
(15)
OPERATING INCOME
3,864
3,462
12
Gains and other income, net 8
40
11
264
Interest expense
(565)
(403)
(40)
Interest income
30
26
15
Equity in earnings 9
9
18
(50)
INCOME BEFORE INCOME TAXES
3,378
3,114
8
Provision for income taxes
(295)
(756)
61
NET INCOME
$ 3,083
$ 2,358
31
EARNINGS PER SHARE
Earnings per share – basic
$ 10.23
$ 7.27
41
Earnings per share – diluted
$ 10.18
$ 7.24
41
Basic Shares
301.5
324.4
Diluted Shares
302.9
325.8
1
Franchise fees include fees from our franchise agreements, application and relicensing fees, timeshare and yacht fees, co-branded credit card fees, and
residential branding fees.
2
Contract investment amortization includes amortization of capitalized costs to obtain contracts with our owner and franchisee customers, and any related
impairments, accelerations, or write-offs.
3
Owned, leased, and other revenue includes revenue from the properties we own or lease, termination fees, and other revenue.
4
Cost reimbursement revenue includes reimbursements from properties for property-level and centralized programs and services that we operate for the benefit of
our hotel owners. Reimbursed expenses include costs incurred by Marriott for certain property-level operating expenses and centralized programs and services.
5
Owned, leased, and other – direct expenses include operating expenses related to our owned or leased hotels, including lease payments and pre-opening expenses.
6
Depreciation, amortization, and other expenses include depreciation for fixed assets, amortization of capitalized costs incurred to acquire management, franchise,
and license agreements, and any related impairments, accelerations, or write-offs.
7
General, administrative, and other expenses include our corporate and business segments overhead costs and general expenses.
8
Gains and other income, net includes gains and losses on the sale of real estate, the sale of joint venture interests and other investments, and adjustments from
other equity investments.
9
Equity in earnings include our equity in earnings or losses of unconsolidated equity method investments.
MARRIOTT INTERNATIONAL, INC.
NON-GAAP FINANCIAL MEASURES
(in millions except per share amounts)
The following table presents our reconciliations of Adjusted operating income, Adjusted operating income margin, Adjusted net income, and Adjusted diluted earnings
per share, to the most directly comparable GAAP measure. Adjusted total revenues is used in the determination of Adjusted operating income margin.
Three Months Ended
Twelve Months Ended
Percent
Percent
December 31,
December 31,
Better/
December 31,
December 31,
Better/
2023
2022
(Worse)
2023
2022
(Worse)
Total revenues, as reported
$ 6,095
$ 5,923
$ 23,713
$ 20,773
Less: Cost reimbursement revenue
(4,418)
(4,420)
(17,413)
(15,417)
Add: Impairments 1
–
–
–
5
Adjusted total revenues **
1,677
1,503
6,300
5,361
Operating income, as reported
718
996
3,864
3,462
Less: Cost reimbursement revenue
(4,418)
(4,420)
(17,413)
(15,417)
Add: Reimbursed expenses
4,684
4,349
17,424
15,141
Add: Merger-related charges and other
8
1
60
12
Add: Impairments 1
–
–
–
5
Adjusted operating income **
992
926
7 %
3,935
3,203
23 %
Operating income margin
12 %
17 %
16 %
17 %
Adjusted operating income margin **
59 %
62 %
62 %
60 %
Net income, as reported
848
673
3,083
2,358
Less: Cost reimbursement revenue
(4,418)
(4,420)
(17,413)
(15,417)
Add: Reimbursed expenses
4,684
4,349
17,424
15,141
Add: Merger-related charges and other
8
1
60
12
Add: Impairments 2
–
–
–
11
Less: Gains on investees’ property sales 3
–
–
–
(23)
Less: Gain on asset dispositions 4
–
–
(24)
(2)
Income tax effect of above adjustments
(67)
19
(3)
69
Less: Income tax special items
–
–
(100)
30
Adjusted net income **
$ 1,055
$ 622
70 %
$ 3,027
$ 2,179
39 %
Diluted earnings per share, as reported
$ 2.87
$ 2.12
$ 10.18
$ 7.24
Adjusted diluted earnings per share**
$ 3.57
$ 1.96
82 %
$ 9.99
$ 6.69