Marriott International is back to profitability again
This week, the international hotel chain Marriott International Inc. (MAR) presented a report for the fourth quarter of 2021. The data show that tourists are starting to return, although it is too early to talk about a full recovery. Marriott International’s total revenue in the fourth quarter increased by 105% year-on-year to $4.45 billion. In addition, comparable revenue per room increased by almost 125% year on year.
It was too easy to compare with 2020, and hotels were closed to visitors or operated at no more than one-third of capacity. As a result, revenue per room in the fourth quarter of 2021 was 19% lower than in the fourth quarter of 2019. The good news is that the hotel chain has returned to profitability again. At the end of the quarter, the company made $468 million, or $1.42 per share.
The loss amounted to more than $164 million. The economic recovery and travel return is positive trend for Marriott International. Despite lower revenue than in 2019, the company records a higher profit indicator. One of the reasons for this is the franchise sales system.
The company owns only 1% of its 1.4 million rooms, and the remaining 99% of Marriott only manages real estate. As a result, Marriott is not responsible for the hotel’s operating costs or capital costs, which usually provides greater financial flexibility. Marriott can also benefit from the geographical diversity of locations, although it notes a strong dependence on activity in North America, which accounts for more than two-thirds of revenue.
