Oct 6, 2005
/FIRST ADD -- DCTH010 -- Marriott International, Inc. Earnings/
/FIRST ADD -- DCTH010 -- Marriott International, Inc. Earnings/
Oct 06, 2005 /PRNewswire via COMTEX/ --
MARRIOTT INTERNATIONAL, INC.
Financial Highlights
(in millions, except per share amounts)
12 Weeks Ended 12 Weeks Ended
September 9, 2005 September 10, 2004
-------------------- --------------------
Percent
Synthetic Synthetic Better/
Lodging Fuel Total Lodging Fuel Total (Worse)
------- ------ ----- ------- ------ ----- -------
REVENUES
Base management fees $108 $- $108 $97 $- $97 11
Franchise fees 78 - 78 74 - 74 5
Incentive management fees 30 - 30 21 - 21 43
Owned, leased, corporate
housing and other(1) 236 - 236 153 - 153 54
Timeshare interval
sales and services(2) 393 - 393 299 - 299 31
Cost reimbursements(3) 1,771 - 1,771 1,573 - 1,573 13
Synthetic fuel - 98 98 - 87 87 13
------- ------ ----- ------- ------ -----
Total Revenues 2,616 98 2,714 2,217 87 2,304 18
OPERATING COSTS AND
EXPENSES
Owned, leased and
corporate housing --
direct(4) 197 - 197 139 - 139 (42)
Timeshare -- direct 330 - 330 249 - 249 (33)
Reimbursed costs 1,771 - 1,771 1,573 - 1,573 (13)
General, administrative
and other(5) 149 - 149 126 - 126 (18)
Synthetic fuel - 132 132 - 118 118 (12)
------- ------ ----- ------- ------ -----
Total Expenses 2,447 132 2,579 2,087 118 2,205 (17)
------- ------ ----- ------- ------ -----
OPERATING INCOME (LOSS) $169 $(34) 135 $130 $(31) 99 36
======= ====== ======= ======
Gains and other
income(6) 39 43 (9)
Interest expense (24) (23) (4)
Interest income 13 33 (61)
Provision for loan
losses (17) - *
Equity in earnings/
(losses) - Other(7) 17 (8) 313
----- -----
INCOME BEFORE INCOME
TAXES AND MINORITY
INTEREST 163 144 13
Provision for income
taxes (33) (28) (18)
----- -----
INCOME BEFORE MINORITY
INTEREST 130 116 12
Minority interest 18 16 13
----- -----
INCOME FROM CONTINUING
OPERATIONS 148 132 12
DISCONTINUED OPERATIONS 1 1 -
----- -----
NET INCOME $149 $133 12
===== =====
EARNINGS PER SHARE
- Basic
Earnings from
continuing operations $0.69 $0.59 17
Earnings from
discontinued operations - - *
----- -----
EARNINGS PER SHARE
- Basic $0.69 $0.59 17
===== =====
EARNINGS PER SHARE
- Diluted
Earnings from
continuing operations $0.65 $0.55 18
Earnings from
discontinued operations - 0.01 (100)
----- -----
EARNINGS PER SHARE
- Diluted $0.65 $0.56 16
===== =====
Basic Shares 215.3 225.9
Diluted Shares 229.3 238.9
* Percent can not be calculated.
1 -- Owned, leased, corporate housing and other revenue includes revenue
from the properties we own or lease, revenue from our ExecuStay
business, land rent income and other revenue.
2 -- Timeshare interval sales and services includes total timeshare
revenue except for base fees, cost reimbursements, gains, and joint
venture earnings (losses).
3 -- Cost reimbursements include reimbursements from lodging 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 ExecuStay business.
5 -- General, administrative and other expenses include the overhead costs
allocated to our lodging business segments (including ExecuStay and
Timeshare) and our unallocated corporate overhead costs and general
expenses.
6 -- Gains and other income includes gains on the sale of real estate,
gains from the sale of joint ventures, income related to our cost
method joint ventures and the earn-out payments we made to the
previous owner of the synthetic fuel operations and earn-out payments
we received from our synthetic fuel joint venture partner.
7 -- Equity in earnings/(losses) -- Other includes our equity in earnings
(losses) of unconsolidated joint ventures.
MARRIOTT INTERNATIONAL, INC.
Financial Highlights
(in millions, except per share amounts)
36 Weeks Ended 36 Weeks Ended
September 9, 2005 September 10, 2004
-------------------- --------------------
Percent
Synthetic Synthetic Better/
Lodging Fuel Total Lodging Fuel Total (Worse)
------- ------ ----- ------- ------ ----- -------
REVENUES
Base management fees $342 $- $342 $302 $- $302 13
Franchise fees 226 - 226 207 - 207 9
Incentive management
fees 132 - 132 90 - 90 47
Owned, leased,
corporate housing
and other(1) 583 - 583 491 - 491 19
Timeshare interval
sales and services(2) 1,074 - 1,074 898 - 898 20
Cost reimbursements(3) 5,248 - 5,248 4,772 - 4,772 10
Synthetic fuel - 304 304 - 198 198 54
------- ------ ----- ------- ------ -----
Total Revenues 7,605 304 7,909 6,760 198 6,958 14
OPERATING COSTS AND
EXPENSES
Owned, leased and
corporate housing --
direct(4) 480 - 480 428 - 428 (12)
Timeshare -- direct 871 - 871 746 - 746 (17)
Reimbursed costs 5,248 - 5,248 4,772 - 4,772 (10)
General, administrative
and other(5) 557 - 557 385 - 385 (45)
Synthetic fuel - 419 419 - 259 259 (62)
------- ------ ----- ------- ------ -----
Total Expenses 7,156 419 7,575 6,331 259 6,590 (15)
------- ------ ----- ------- ------ -----
OPERATING INCOME (LOSS) $449 $(115) 334 $429 $(61) 368 (9)
======= ====== ======= ======
Gains and other
income(6) 97 95 2
Interest expense (69) (69) -
Interest income 65 98 (34)
Provision for loan
losses (28) - *
Equity in earnings/
(losses) - Synthetic
fuel(7) - (28) 100
- Other(8) 18 (9) 300
----- -----
INCOME BEFORE INCOME
TAXES AND MINORITY
INTEREST 417 455 (8)
Provision for income
taxes (18) (79) 77
----- -----
INCOME BEFORE MINORITY
INTEREST 399 376 6
Minority interest 32 30 7
----- -----
INCOME FROM CONTINUING
OPERATIONS 431 406 6
DISCONTINUED OPERATIONS 1 1 -
----- -----
NET INCOME $432 $407 6
===== =====
EARNINGS PER SHARE -
Basic
Earnings from
continuing operations $1.96 $1.78 10
Earnings from
discontinued
operations - 0.01 (100)
----- -----
EARNINGS PER SHARE -
Basic $1.96 $1.79 9
===== =====
EARNINGS PER SHARE -
Diluted
Earnings from
continuing operations $1.83 $1.69 8
Earnings from
discontinued
operations - - *
----- -----
EARNINGS PER SHARE -
Diluted $1.83 $1.69 8
===== =====
Basic Shares 220.4 227.5
Diluted Shares 235.3 240.9
* Percent can not be calculated.
1 -- Owned, leased, corporate housing and other revenue includes revenue
from the properties we own or lease, revenue from our ExecuStay
business, land rent income and other revenue.
2 -- Timeshare interval sales and services includes total timeshare
revenue except for base fees, cost reimbursements, gains, and joint
venture earnings (losses).
3 -- Cost reimbursements include reimbursements from lodging properties
for Marriott funded operating expenses.
4 -- Owned, leased and corporate housing -- direct expenses include
operating expenses related to our owned or leased hotels, including
lease payments, pre-opening expenses and depreciation, plus expenses
related to our ExecuStay business.
5 -- General, administrative and other expenses include the overhead costs
allocated to our lodging business segments (including ExecuStay and
Timeshare) and our unallocated corporate overhead costs and general
expenses.
6 -- Gains and other income includes gains on the sale of real estate,
gains from the sale of joint ventures, income related to our cost
method joint ventures and the earn-out payments we made to the
previous owner of the synthetic fuel operations and earn-out payments
we received from our synthetic fuel joint venture partner.
7 -- Equity in earnings/(losses) - Synthetic fuel includes our share of
the equity in earnings of the synthetic fuel joint ventures and the
net earn-out payments made to our synthetic fuel joint venture
partner from January 3, 2004 through March 25, 2004. Beginning March
26, 2004, we consolidated the synthetic fuel operations as a result
of adopting FIN 46(R), "Consolidation of Variable Interest Entities."
8 -- Equity in earnings/(losses) -- Other includes our equity in (losses)
earnings of unconsolidated joint ventures.
Marriott International, Inc.
Business Segments
($ in millions)
Twelve Weeks Ended
--------------------------- Percent
September 9, September 10, Better/
2005 2004 (Worse)
------------ ------------ -------
REVENUES
Full-Service $1,713 $1,459 17%
Select-Service 303 277 9%
Extended-Stay 149 133 12%
Timeshare 451 348 30%
------------ ------------
Total lodging(1) 2,616 2,217 18%
Synthetic fuel 98 87 13%
------------ ------------
Total $2,714 $2,304 18%
============ ============
INCOME FROM CONTINUING OPERATIONS
Full-Service $129 $79 63%
Select-Service 49 42 17%
Extended-Stay 14 20 -30%
Timeshare 50 34 47%
------------ ------------
Total lodging financial results(1) 242 175 38%
Synthetic fuel (after-tax) 30 31 -3%
Unallocated corporate expenses (38) (28) -36%
Interest income, (provision
for loan losses) and
(interest expense) (28) 10 -380%
Income taxes (excluding
Synthetic fuel) (58) (56) -4%
------------ ------------
Total $148 $132 12%
============ ============
(1) We consider lodging revenues and lodging financial results to be
meaningful indicators of our performance because they measure our
growth in profitability as a lodging company and enable investors to
compare the sales and results of our lodging operations to those of
other lodging companies.
Marriott International, Inc.
Business Segments
($ in millions)
Thirty-Six Weeks Ended
--------------------------- Percent
September 9, September 10, Better/
2005 2004 (Worse)
------------ ------------ -------
REVENUES
Full-Service $5,093 $4,512 13%
Select-Service 868 788 10%
Extended-Stay 411 377 9%
Timeshare 1,233 1,083 14%
------------ ------------
Total lodging(1) 7,605 6,760 13%
Synthetic fuel 304 198 54%
------------ ------------
Total $7,909 $6,958 14%
============ ============
INCOME FROM CONTINUING OPERATIONS
Full-Service $275 $292 -6%
Select-Service 130 104 25%
Extended-Stay 43 48 -10%
Timeshare 193 135 43%
------------ ------------
Total lodging financial results(1) 641 579 11%
Synthetic fuel (after-tax) 92 73 26%
Unallocated corporate expenses (97) (91) -7%
Interest income, (provision for
loan losses) and (interest
expense) (32) 29 -210%
Income taxes (excluding
Synthetic fuel) (173) (184) 6%
------------ ------------
Total $431 $406 6%
============ ============
(1) We consider lodging revenues and lodging financial results to be
meaningful indicators of our performance because they measure our
growth in profitability as a lodging company and enable investors to
compare the sales and results of our lodging operations to those of
other lodging companies.
MARRIOTT INTERNATIONAL, INC.
Total Lodging Products(1)
-------------------------------------------------------------------------
Number of Number of
Properties Rooms/Suites
----------------- ------------------
Change vs. Change vs.
Sept. 9, Sept. 10, Sept. 9, Sept. 10,
Brand 2005 2004 2005 2004
------------------------------ -----------------------------------------
Full-Service Lodging
Marriott Hotels & Resorts 502 15 181,599 3,268
The Ritz-Carlton 58 1 18,907 294
Renaissance Hotels & Resorts 137 5 48,137 865
Bulgari Hotel & Resort 1 - 58 -
Ramada International 4 (199) 724 (27,034)
Select-Service Lodging
Courtyard 680 34 98,043 5,381
Fairfield Inn 521 (3) 47,826 (1,299)
SpringHill Suites 135 14 15,767 1,697
Extended-Stay Lodging
Residence Inn 482 25 57,296 2,927
TownePlace Suites 119 6 12,021 466
Marriott Executive Apartments 16 2 2,809 338
Timeshare(2)
Marriott Vacation Club
International 44 1 9,231 694
The Ritz-Carlton Club 4 - 280 19
Grand Residences by Marriott 2 - 248 -
Horizons by Marriott Vacation
Club International 2 - 328 -
------------------ --------------------
Total 2,707 (99) 493,274 (12,384)
================== ====================
(1) Total Lodging Products excludes the 1,805 corporate housing rental
units.
(2) Includes products in active sales which are not ready for occupancy.
MARRIOTT INTERNATIONAL, INC.
KEY LODGING STATISTICS
North American Comparable Company-Operated Properties
--------------------------------------------------------------------------
Twelve Weeks Ended September 9, 2005 and
September 10, 2004
---------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- -------------
Brand 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
--------------------------------------------------------------------------
Marriott Hotels
& Resorts $108.10 8.1% 75.7% 0.8% pts. $142.75 6.9%
The Ritz-Carlton(1) $182.22 11.0% 72.7% 1.9% pts. $250.61 8.0%
Renaissance Hotels
& Resorts $100.97 12.8% 74.1% 3.1% pts. $136.27 8.1%
Composite -
Full-Service(2) $114.63 9.2% 75.2% 1.3% pts. $152.50 7.3%
Residence Inn $90.15 6.8% 83.4% -1.0% pts. $108.13 8.1%
Courtyard $76.38 7.8% 73.5% -0.5% pts. $103.94 8.5%
TownePlace Suites $57.77 9.6% 80.9% 2.0% pts. $71.43 6.9%
SpringHill Suites $74.94 13.0% 78.7% 0.7% pts. $95.17 12.0%
Composite -
Select- Service &
Extended-Stay(2) $78.73 8.0% 77.0% -0.3% pts. $102.31 8.5%
Composite - All(2) $100.38 8.8% 75.9% 0.7% pts. $132.29 7.9%
North American Comparable Systemwide Properties
-------------------------------------------------------------------------
Twelve Weeks Ended September 9, 2005 and
September 10, 2004
--------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- -------------
Brand 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
-------------------------------------------------------------------------
Marriott Hotels
& Resorts $99.41 7.5% 73.5% 0.9% pts. $135.30 6.2%
The Ritz-Carlton(1) $182.22 11.0% 72.7% 1.9% pts. $250.61 8.0%
Renaissance Hotels &
Resorts $96.14 12.2% 73.6% 2.5% pts. $130.55 8.3%
Composite -
Full-Service(2) $104.60 8.5% 73.4% 1.2% pts. $142.42 6.7%
Residence Inn $89.12 6.7% 83.7% -0.3% pts. $106.42 7.1%
Courtyard $79.35 7.5% 75.7% 0.2% pts. $104.84 7.1%
Fairfield Inn $57.25 10.0% 75.2% 1.7% pts. $76.15 7.5%
TownePlace Suites $58.23 9.3% 80.4% 0.1% pts. $72.46 9.1%
SpringHill Suites $70.33 11.1% 77.0% 1.5% pts. $91.36 8.9%
Composite - Select-
Service &
Extended-Stay(2) $75.30 7.9% 78.1% 0.5% pts. $96.47 7.3%
Composite - All(2) $87.63 8.2% 76.1% 0.8% pts. $115.12 7.1%
(1) Statistics for The Ritz-Carlton are for June through August.
(2) Full-Service composite statistics include properties for Marriott
Hotels & Resorts, Renaissance Hotels & Resorts and The Ritz-Carlton.
Select-Service and Extended-Stay composite statistics include
properties for the Courtyard, Residence Inn, TownePlace Suites,
Fairfield Inn and SpringHill Suites brands. Composite - All statistics
include properties for the Marriott Hotels & Resorts, Renaissance
Hotels & Resorts, The Ritz-Carlton, Courtyard, Residence Inn,
TownePlace Suites, Fairfield Inn, and SpringHill Suites brands.
MARRIOTT INTERNATIONAL, INC.
KEY LODGING STATISTICS
North American Comparable Company-Operated Properties
--------------------------------------------------------------------------
Thirty-Six Weeks Ended September 9, 2005 and
September 10, 2004
----------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- -------------
Brand 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
--------------------------------------------------------------------------
Marriott Hotels
& Resorts $112.37 8.2% 74.1% 0.7% pts. $151.66 7.1%
The Ritz-Carlton(1) $206.85 11.9% 72.1% 1.0% pts. $286.93 10.4%
Renaissance Hotels
& Resorts $106.32 11.4% 72.6% 2.6% pts. $146.54 7.4%
Composite -
Full-Service(2) $120.10 9.2% 73.7% 1.0% pts. $163.02 7.6%
Residence Inn $86.57 8.1% 80.7% 0.6% pts. $107.34 7.2%
Courtyard $75.83 8.6% 71.8% -0.5% pts. $105.59 9.4%
TownePlace Suites $53.46 8.0% 76.4% 0.5% pts. $70.02 7.4%
SpringHill Suites $71.07 17.3% 76.1% 4.2% pts. $93.36 10.9%
Composite - Select-
Service &
Extended-Stay(2) $76.96 9.0% 74.8% 0.2% pts. $102.91 8.7%
Composite - All(2) $102.84 9.1% 74.1% 0.7% pts. $138.75 8.1%
North American Comparable Systemwide Properties
--------------------------------------------------------------------------
Thirty-Six Weeks Ended September 9, 2005 and
September 10, 2004
---------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- -------------
Brand 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
--------------------------------------------------------------------------
Marriott Hotels
& Resorts $101.82 7.9% 71.9% 0.9% pts. $141.68 6.6%
The Ritz-Carlton(1) $206.85 11.9% 72.1% 1.0% pts. $286.93 10.4%
Renaissance Hotels
& Resorts $98.74 11.4% 71.6% 2.4% pts. $137.96 7.7%
Composite -
Full-Service(2) $107.77 8.8% 71.8% 1.1% pts. $150.02 7.1%
Residence Inn $84.19 7.7% 80.3% 0.7% pts. $104.87 6.8%
Courtyard $76.84 8.3% 73.2% 0.4% pts. $105.03 7.8%
Fairfield Inn $52.32 10.9% 70.4% 1.9% pts. $74.36 8.0%
TownePlace Suites $54.81 10.3% 76.3% 0.5% pts. $71.80 9.6%
SpringHill Suites $67.42 13.6% 74.6% 2.9% pts. $90.38 9.1%
Composite - Select-
Service &
Extended-Stay(2) $71.54 8.9% 74.7% 1.0% pts. $95.77 7.5%
Composite - All(2) $86.68 8.9% 73.5% 1.0% pts. $117.93 7.3%
(1) Statistics for The Ritz-Carlton are for January through August.
(2) Full-Service composite statistics include properties for Marriott
Hotels & Resorts, Renaissance Hotels & Resorts and The Ritz-Carlton.
Select-Service and Extended-Stay composite statistics include
properties for the Courtyard, Residence Inn, TownePlace Suites,
Fairfield Inn and SpringHill Suites brands. Composite - All statistics
include properties for the Marriott Hotels & Resorts, Renaissance
Hotels & Resorts, The Ritz-Carlton, Courtyard, Residence Inn,
TownePlace Suites, Fairfield Inn, and SpringHill Suites brands.
MARRIOTT INTERNATIONAL, INC.
KEY LODGING STATISTICS
(Constant $)
International Comparable Company-Operated Properties(1,2)
--------------------------------------------------------------------------
Three Months Ended August 31, 2005 and August 31, 2004
------------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- -------------
Region/Brand(3) 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
--------------------------------------------------------------------------
Caribbean & Latin
America $100.71 10.3% 74.5% 3.0% pts. $135.15 5.8%
Continental Europe $96.26 4.3% 74.9% 1.5% pts. $128.51 2.2%
United Kingdom $141.41 5.2% 80.6% 2.4% pts. $175.45 2.2%
Middle East & Africa $67.51 20.3% 70.9% -0.3% pts. $95.28 20.8%
Asia Pacific(4) $80.14 10.2% 76.3% -0.6% pts. $104.98 11.1%
Ritz-Carlton
International $131.43 14.2% 67.7% -0.5% pts. $194.14 15.1%
Total
International(5) $97.73 9.9% 75.6% 0.9% pts. $129.35 8.6%
Worldwide(6) $99.66 9.1% 75.8% 0.7% pts. $131.50 8.0%
International Comparable Systemwide Properties(1,2)
--------------------------------------------------------------------------
Three Months Ended August 31, 2005 and August 31, 2004
------------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- -------------
Region/Brand(3) 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
--------------------------------------------------------------------------
Caribbean & Latin
America $95.27 12.5% 73.1% 4.4% pts. $130.29 5.8%
Continental Europe $96.95 7.4% 71.9% 1.2% pts. $134.79 5.6%
United Kingdom $119.95 2.3% 76.3% -0.2% pts. $157.14 2.6%
Middle East & Africa $65.41 18.4% 69.2% -0.8% pts. $94.51 19.7%
Asia Pacific(4) $85.92 12.0% 76.7% 0.2% pts. $112.08 11.7%
Ritz-Carlton
International $131.43 14.2% 67.7% -0.5% pts. $194.14 15.1%
Total
International(5) $97.73 11.3% 74.5% 1.3% pts. $131.14 9.4%
Worldwide(6) $89.40 8.8% 75.8% 0.9% pts. $117.89 7.6%
(1) International financial results are reported on a period basis, while
International statistics are reported on a monthly basis.
(2) Statistics are in constant dollars and include results for June
through August. Excludes North America except for Worldwide.
(3) Region information includes Marriott Hotels & Resorts, Renaissance
Hotels & Resorts, and Courtyard and excludes The Ritz-Carlton.
(4) Excludes Hawaii.
(5) Includes Hawaii.
(6) Worldwide includes international statistics for June through August
and North American statistics for the twelve weeks ending September 9,
2005 and September 10, 2004.
MARRIOTT INTERNATIONAL, INC.
KEY LODGING STATISTICS
(Constant $)
International Comparable Company-Operated Properties(1,2)
--------------------------------------------------------------------------
Eight Months Ended August 31, 2005 and August 31, 2004
------------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- ------------
Region/Brand(3) 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
--------------------------------------------------------------------------
Caribbean & Latin
America $113.99 14.1% 75.3% 3.8% pts. $151.45 8.4%
Continental Europe $94.73 3.2% 69.2% 0.7% pts. $136.80 2.1%
United Kingdom $139.77 5.0% 76.5% 0.3% pts. $182.69 4.6%
Middle East & Africa $77.70 27.1% 75.5% 4.7% pts. $102.94 19.2%
Asia Pacific(4) $82.86 14.6% 75.3% 1.1% pts. $110.00 13.0%
Ritz-Carlton
International $149.35 21.7% 71.7% 4.6% pts. $208.44 14.0%
Total
International(5) $101.08 12.0% 73.9% 1.9% pts. $136.79 9.0%
Worldwide(6) $102.41 9.8% 74.1% 1.0% pts. $138.27 8.3%
International Comparable Systemwide Properties(1,2)
--------------------------------------------------------------------------
Eight Months Ended August 31, 2005 and August 31, 2004
------------------------------------------------------
Average
REVPAR Occupancy Daily Rate
------------- ------------- -------------
Region/Brand(3) 2005 vs. 2004 2005 vs. 2004 2005 vs. 2004
--------------------------------------------------------------------------
Caribbean & Latin
America $107.49 14.9% 73.6% 4.0% pts. $146.00 8.7%
Continental Europe $92.79 5.8% 66.8% 1.1% pts. $138.88 4.1%
United Kingdom $118.15 2.0% 71.8% -1.9% pts. $164.67 4.8%
Middle East & Africa $74.84 25.7% 73.4% 4.4% pts. $101.95 18.1%
Asia Pacific(4) $87.11 14.9% 76.0% 1.7% pts. $114.68 12.4%
Ritz-Carlton
International $149.35 21.7% 71.7% 4.6% pts. $208.44 14.0%
Total
International(5) $99.23 12.5% 72.8% 2.1% pts. $136.27 9.3%
Worldwide(6) $88.68 9.5% 73.4% 1.2% pts. $120.82 7.7%
(1) International financial results are reported on a period basis, while
International statistics are reported on a monthly basis.
(2) Statistics are in constant dollars and include results for January
through August. Excludes North America except for Worldwide.
(3) Region information includes Marriott Hotels & Resorts, Renaissance
Hotels & Resorts, and Courtyard and excludes The Ritz-Carlton.
(4) Excludes Hawaii.
(5) Includes Hawaii.
(6) Worldwide includes international statistics for January through August
and North American statistics for the thirty-six weeks ending
September 9, 2005 and September 10, 2004.
MARRIOTT INTERNATIONAL, INC.
Non-GAAP Financial Measure Reconciliation
($ in millions)
We consider lodging operating income to be a meaningful indicator of our performance because it measures our growth in profitability as a lodging company and enables investors to compare the operating income related to our lodging segments to the operating income of other lodging companies. However, lodging operating income is a non-GAAP financial measure and is not an alternative to operating income or any other operating measure prescribed by United States generally accepted accounting principles.
The reconciliation of operating income to lodging operating income is as
follows:
Fiscal Year 2005
---------------------------------
First Second Third
Quarter Quarter Quarter Total
------- ------- ------- ------
Operating income as reported $158 $41 $135 $334
Add back: Synthetic fuel operating loss 45 36 34 115
------ ------ ------ ------
Lodging operating income $203 $77 $169 $449
====== ====== ====== ======
Fiscal Year 2004
-----------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter Total
------- ------- ------- ------- -----
Operating income as reported $151 $118 $99 $109 $477
Add back: Synthetic fuel
operating loss - 30 31 37 98
------ ------ ------ ------ ------
Lodging operating income $151 $148 $130 $146 $575
====== ====== ====== ====== ======
MARRIOTT INTERNATIONAL, INC.
Non-GAAP Financial Measure Reconciliation
(in millions, except per share amounts)
The table below details the impact on our continuing operations of our Synthetic Fuel segment for the 2005 and 2004 third quarters. Our management evaluates the figures presented in the "Excluding Synthetic Fuel" columns because management expects the Synthetic Fuel segment will no longer have a material impact on our business after the Internal Revenue Code Section 29 synthetic fuel tax credits expire at the end of 2007 and because the presentation reflects the results of our core lodging operations. Management also believes that these presentations facilitate the comparison of our results with the results of other lodging companies.
However, the figures presented in the "Excluding Synthetic Fuel" columns are all non-GAAP financial measures, may be calculated and/or presented differently than presentations of other companies and are not alternatives to operating income, income from continuing operations, net income, earnings per share or any other operating measure prescribed by United States generally accepted accounting principles.
Third Quarter 2005 Third Quarter 2004
Continuing Operations Continuing Operations
------------------------------ ------------------------------
Income Income
from Synthetic Excluding from Synthetic Excluding
Continuing Fuel Synthetic Continuing Fuel Synthetic
Operations Impact Fuel Operations Impact Fuel
---------- --------- --------- ---------- --------- ---------
Operating
income
(loss) $135 $(34) $169 $99 $(31) $130
Gains and
other income 39 21 18 43 19 24
Interest
income,
(provision for
loan losses)
and (interest
expense) (28) - (28) 10 - 10
Equity in
earnings/
(losses) 17 - 17 (8) - (8)
---------- --------- --------- ---------- --------- ---------
Pre-tax income
(loss) 163 (13) 176 144 (12) 156
---------- --------- --------- ---------- --------- ---------
Tax Provision (61) (3) (58) (57) (1) (56)
Tax Credits 28 28 - 29 29 -
---------- --------- --------- ---------- --------- ---------
Total Tax
(Provision)/
Benefit (33) 25 (58) (28) 28 (56)
---------- --------- --------- ---------- --------- ---------
Income from
Continuing
Operations
before Minority
Interest 130 12 118 116 16 100
Minority
Interest 18 18 - 16 15 1
---------- --------- --------- ---------- --------- ---------
Income from
Continuing
Operations $148 $30 $118 $132 $31 $101
========== ========= ========= ========== ========= =========
Diluted Shares 229.3 229.3 229.3 238.9 238.9 238.9
Earnings per
Share -
Diluted $0.65 $0.13 $0.52 $0.55 $0.13 $0.42
Tax Rate 20.2% 19.6%
MARRIOTT INTERNATIONAL, INC.
Non-GAAP Financial Measure Reconciliation
(in millions, except per share amounts)
The table below details the impact on our continuing operations of our Synthetic Fuel segment for the 36-weeks ended September 9, 2005 and September 10, 2004. Our management evaluates the figures presented in the "Excluding Synthetic Fuel" columns because management expects the Synthetic Fuel segment will no longer have a material impact on our business after the Internal Revenue Code Section 29 synthetic fuel tax credits expire at the end of 2007 and because the presentation reflects the results of our core lodging operations. Management also believes that these presentations facilitate the comparison of our results with the results of other lodging companies.
However, the figures presented in the "Excluding Synthetic Fuel" columns are all non-GAAP financial measures, may be calculated and/or presented differently than presentations of other companies and are not alternatives to operating income, income from continuing operations, net income, earnings per share or any other operating measure prescribed by United States generally accepted accounting principles.
Third Quarter YTD 2005 Third Quarter YTD 2004
Continuing Operations Continuing Operations
------------------------------ ------------------------------
Income Income
from Synthetic Excluding from Synthetic Excluding
Continuing Fuel Synthetic Continuing Fuel Synthetic
Operations Impact Fuel Operations Impact Fuel
---------- --------- --------- ---------- --------- ---------
Operating
income
(loss) $334 $(115) $449 $368 $(61) $429
Gains and
other
income 97 20 77 95 28 67
Interest
income,
(provision
for loan
losses) and
(interest
expense) (32) - (32) 29 - 29
Equity in
earnings/
(losses) 18 - 18 (37) (28) (9)
---------- --------- --------- ---------- --------- ---------
Pre-tax income
(loss) 417 (95) 512 455 (61) 516
---------- --------- --------- ---------- --------- ---------
Tax
(Provision)/
Benefit (152) 21 (173) (172) 12 (184)
Tax Credits 134 134 - 93 93 -
---------- --------- --------- ---------- --------- ---------
Total Tax
(Provision)/
Benefit (18) 155 (173) (79) 105 (184)
---------- --------- --------- ---------- --------- ---------
Income from
Continuing
Operations
before Minority
Interest 399 60 339 376 44 332
Minority
Interest 32 32 - 30 29 1
---------- --------- --------- ---------- --------- ---------
Income from
Continuing
Operations $431 $92 $339 $406 $73 $333
========== ========= ========= ========== ========= =========
Diluted Shares 235.3 235.3 235.3 240.9 240.9 240.9
Earnings per
Share -
Diluted $1.83 $0.39 $1.44 $1.69 $0.30 $1.39
Tax Rate 4.3% 17.4%
MARRIOTT INTERNATIONAL, INC.
Non-GAAP Financial Measure Reconciliation
(in millions, except per share amounts)
The table below details the impact on our continuing operations of the $17 million leveraged lease impairment charge recorded in the 2005 third quarter which was associated with the impairment of our one investment in a leveraged lease. We do not consider the leveraged lease investment to be related to our core business.
Our management evaluates the figures in the "Excluding Leveraged Lease Charge" column because they allow for year-over-year comparisons relative to our on-going operations before the material charge and believes that this presentation facilitates the comparison of our results with the results of other lodging companies. Management also evaluates income- related financial measures that exclude the leveraged lease impairment charge in order to better assess the period-over-period performance of our core operating businesses.
However, the figures presented in the "Excluding Leveraged Lease Charge" column are all non-GAAP financial measures, may be calculated and/or presented differently than presentations of other companies, and are not alternatives to operating income, income from continuing operations, net income, earnings per share or any other operating measure prescribed by United States generally accepted accounting principles.
Twelve weeks ending Twelve weeks ending
September 9, 2005 September 10, 2004
----------------------------- -----------------------------
Income Excluding Income Excluding
from Leveraged Leveraged from Leveraged Leveraged
Continuing Lease Lease Continuing Lease Lease
Operations Charge Charge Operations Charge Charge
---------- -------- -------- ---------- -------- ---------
Operating income $135 $- $135 $99 $- $99
Gains and
other income 39 - 39 43 - 43
Interest
income,
(provision for
loan losses)
and (interest
expense) (28) (17) (11) 10 - 10
Equity in
earnings/
(losses) 17 - 17 (8) - (8)
---------- -------- -------- ---------- -------- ---------
Pre-tax income
(loss) 163 (17) 180 144 - 144
---------- -------- -------- ---------- -------- ---------
Tax
(Provision)/
Benefit (61) 6 (67) (57) - (57)
Tax Credits 28 - 28 29 - 29
---------- -------- -------- ---------- -------- ---------
Total Tax
(Provision)/
Benefit (33) 6 (39) (28) - (28)
---------- -------- -------- ---------- -------- ---------
Income (Loss)
from Continuing
Operations
before Minority
Interest 130 (11) 141 116 - 116
Minority Interest 18 - 18 16 - 16
---------- -------- -------- ---------- -------- ---------
Income (Loss)
from Continuing
Operations $148 $(11) $159 $132 - $132
========== ======== ======== ========== ======== =========
Diluted Shares 229.3 229.3 229.3 238.9 238.9 238.9
Earnings/(Loss)
per Share -
Diluted $0.65 ($0.05) $0.70 $0.55 - $0.55
MARRIOTT INTERNATIONAL, INC.
Non-GAAP Financial Measure Reconciliation
(in millions, except per share amounts)
The table below details the impact on our continuing operations of the $17 million leveraged lease impairment charge recorded in the 2005 third quarter which was associated with the impairment of our one investment in a leveraged lease. We do not consider the leveraged lease investment to be related to our core business.
Our management evaluates the figures in the "Excluding Leveraged Lease Charge" column because they allow for year-over-year comparisons relative to our on-going operations before the material charge and believes that this presentation facilitates the comparison of our results with the results of other lodging companies. Management also evaluates income-related financial measures that exclude the leveraged lease impairment charge in order to better assess the period-over-period performance of our core operating businesses.
However, the figures presented in the "Excluding Leveraged Lease Charge" column are all non-GAAP financial measures, may be calculated and/or presented differently than presentations of other companies, and are not alternatives to operating income, income from continuing operations, net income, earnings per share or any other operating measure prescribed by United States generally accepted accounting principles.
Thirty-six weeks ending September 9, 2005
--------------------------------------------
Excluding
Income CTF and
from CTF Leveraged Leveraged
Continuing Transaction Lease Lease
Operations Charge Charge Charges
---------- ---------- --------- ---------
Operating income (loss) $334 $(94) $- $428
Gains and other income 97 - - 97
Interest income,
(provision for loan losses)
and (interest expense) (32) - (17) (15)
Equity in earnings 18 - - 18
---------- ---------- --------- ---------
Pre-tax income (loss) 417 (94) (17) 528
---------- ---------- --------- ---------
Tax (Provision)/Benefit (152) 32 6 (190)
Tax Credits 134 - - 134
---------- ---------- --------- ---------
Total Tax (Provision)/ Benefit (18) 32 6 (56)
---------- ---------- --------- ---------
Income (Loss) from Continuing
Operations before
Minority Interest 399 (62) (11) 472
Minority Interest 32 - - 32
---------- ---------- --------- ---------
Income (Loss) from Continuing
Operations $431 $(62) $(11) $504
========== ========== ========= =========
Diluted Shares 235.3 235.3 235.3 235.3
Earnings/(Loss) per
Share - Diluted $1.83 ($0.26) ($0.05) $2.14
Thirty-six weeks ending September 10, 2004
--------------------------------------------
Excluding
Income CTF and
from CTF Leveraged Leveraged
Continuing Transaction Lease Lease
Operations Charge Charge Charges
---------- ---------- --------- ---------
Operating income $368 $- $- $368
Gains and other income 95 - - 95
Interest income,
(provision for loan
losses) and (interest
expense) 29 - - 29
Equity in losses (37) - - (37)
---------- ---------- --------- ---------
Pre-tax income 455 - - 455
Tax Provision (172) - - (172)
Tax Credits 93 - - 93
---------- ---------- --------- ---------
Total Tax Provision (79) - - (79)
---------- ---------- --------- ---------
Income from Continuing
Operations before Minority
Interest 376 - - 376
Minority Interest 30 - - 30
---------- ---------- --------- ---------
Income from Continuing
Operations $406 $- $- $406
========== ========== ========= =========
Diluted Shares 240.9 240.9 240.9 240.9
Earnings per Share - Diluted $1.69 - - $1.69
MARRIOTT INTERNATIONAL, INC.
Non-GAAP Financial Measure
EBITDA
($ in millions)
Our management considers earnings before interest, taxes, depreciation and amortization (EBITDA) to be an indicator of operating performance because it can be used to measure our ability to service debt, fund capital expenditures, and expand our business.
In the 2005 second quarter we recorded a $94 million charge associated with the agreements we entered into with CTF Holdings Ltd. ("the CTF transaction"). The $94 million charge was primarily non-cash and due to the write-off of deferred contract acquisition costs associated with the termination of management agreements. In addition, we incurred a material charge of $17 million in the 2005 third quarter associated with the impairment of our one investment in a leveraged lease. We do not consider the leveraged lease investment to be related to our core business. Management expects the Synthetic Fuel segment will no longer have a material impact on our business after the Internal Revenue Code Section 29 synthetic fuel tax credits expire at the end of 2007.
Management evaluates Adjusted EBITDA which excludes the leveraged lease impairment charge, discontinued operations and the impact of our Synthetic Fuel segment in order to better assess the period-over-period performance of our on-going core operating businesses. Management evaluates Adjusted EBITDA which also excludes the CTF transaction charge in order to better assess the Company's period-over-period performance of our lodging operations in light of the fact that the CTF transaction charge does not reflect the fact that new management agreements entered into as part of the CTF transaction substantially replaced the old management agreements the termination of which makes up the bulk of the CTF transaction charge. Management also believes that these presentations facilitate the comparison of our results with the results of other lodging companies.
However, EBITDA and Adjusted EBITDA are non-GAAP financial measures, may
be calculated and/or presented differently than presentations of other
companies, and are not alternatives to operating income, income from
continuing operations, net income, cash flow from operations, or any other
operating measure prescribed by United States generally accepted accounting
principles.
Fiscal Year 2005
----------------------------------
First Second Third
Quarter Quarter Quarter Total
------- ------- ------- ------
Net income $145 $138 $149 $432
Interest expense 24 21 24 69
Tax provision/(benefit) from
continuing operations 5 (20) 33 18
Tax provision from discontinued
operations - - 1 1
Depreciation(1) 30 29 34 93
Amortization 7 7 7 21
Interest expense from unconsolidated
joint ventures 11 6 4 21
Depreciation and amortization from
unconsolidated joint ventures 12 9 7 28
------- ------- ------- ------
EBITDA $234 $190 $259 $683
Synthetic fuel adjustment 42 21 (6) 57
Pre-tax gain discontinued operations - - (2) (2)
Non-recurring charges -
CTF acquisition charge - 94 - 94
Leveraged lease charge - - 17 17
------- ------- ------- ------
Adjusted EBITDA $276 $305 $268 $849
======= ======= ======= ======
Increase over 2004 Adjusted EBITDA 14% 9% 12% 12%
The following items make up the
synthetic fuel adjustment:
Pre-tax synthetic fuel operating
losses $54 $28 $14 $96
Pre-tax minority interest - synthetic
fuel (10) (5) (18) (33)
Synthetic fuel depreciation (2) (2) (2) (6)
------- ------- ------- ------
EBITDA adjustment for synthetic fuel $42 $21 $(6) $57
======= ======= ======= ======
(1) Does not include depreciation reimbursed by third party owners.
Fiscal Year 2004
-----------------------------------------
First Second Third Fourth
Quarter Quarter Quarter Quarter Total
------- ------- ------- ------- -----
Net income $114 $160 $133 $189 $596
Interest expense 22 24 23 30 99
Tax provision continuing
operations 18 33 28 21 100
Tax provision discontinued
operations - - 1 - 1
Depreciation 32 29 32 40 133
Amortization 7 8 7 11 33
Interest expense from
unconsolidated joint ventures 10 11 9 15 45
Depreciation and amortization
from unconsolidated joint
ventures 13 9 13 17 52
------- ------- ------- ------- -----
EBITDA $216 $274 $246 $323 $1,059
Synthetic fuel adjustment 28 5 (6) 21 48
Pre-tax gain discontinued
operations (1) - (1) (1) (3)
------- ------- ------- ------- -----
Adjusted EBITDA $243 $279 $239 $343 $1,104
======= ======= ======= ======= =====
The following items make up the
synthetic fuel adjustment:
Pre-tax synthetic fuel operating
losses $- $21 $12 $37 $70
Pre-tax synthetic fuel equity
losses 28 - - - 28
Pre-tax minority interest -
synthetic fuel - (14) (15) (11) (40)
Synthetic fuel depreciation - (2) (3) (5) (10)
------- ------- ------- ------- -----
EBITDA adjustment for
synthetic fuel $28 $5 $(6) $21 $48
======= ======= ======= ======= =====
MARRIOTT INTERNATIONAL, INC.
Non-GAAP Financial Measure Reconciliation
(in millions, except per share amounts)
The following reconciles the non-GAAP estimates for the 2005 fourth quarter, full year 2005 and full year 2006 included in the press release to the most directly comparable GAAP measure.
Estimated
Full Year 2005
--------------
General, administrative and other expense $742
Less CTF transaction charge (94)
--------------
General, administrative and other expense
excluding the CTF transaction charge $648
==============
Range
-------------------------------
Estimated Estimated
Full Year 2005 Full Year 2005
-------------- --------------
Lodging operating income $699 $709
Add back CTF transaction charge 94 94
-------------- --------------
Lodging operating income excluding
the CTF transaction charge $793 $803
============== ==============
Estimated Fourth Estimated
Quarter 2005 Full Year 2005
---------------- --------------
Gains and other income $65 $160
Less synthetic fuel gains and other
income (10) (30)
---------------- --------------
Gains and other income, excluding
synthetic fuel gains and other
income $55 $130
================ ==============
Estimated
Full Year 2005
--------------
Interest expense and provision for loan
losses, net of interest income $57
Add back leveraged lease impairment charge (17)
--------------
Interest expense and provision for loan
losses, net of interest income, excluding
the leveraged lease impairment charge $40
==============
Range Range
-------------------- --------------------
Estimated Estimated
Fourth Fourth Estimated Estimated
Quarter Quarter Full Year Full Year
2005 2005 2005 2005
--------- --------- --------- ---------
Diluted earnings per share
from continuing operations $0.95 $0.98 $2.78 $2.81
Add back eps impact of
leveraged lease impairment
charge - - 0.05 0.05
Add back eps impact of CTF
transaction charge - - 0.26 0.26
--------- --------- --------- ---------
Diluted earnings per share
from continuing operations
excluding the eps impact of
both the leveraged lease
impairment charge and the
CTF transaction charge 0.95 0.98 3.09 3.12
Less the eps impact of the
synthetic fuel segment (0.12) (0.12) (0.51) (0.51)
--------- --------- --------- ---------
Diluted earnings per share
from continuing operations
excluding the eps impact of
the leveraged lease
impairment charge, the CTF
transaction charge, and the
synthetic fuel segment $0.83 $0.86 $2.58 $2.61
========= ========= ========= =========
Range
--------------------------------
Estimated Estimated
Full Year 2006 Full Year 2006
-------------- --------------
Diluted earnings per share from
continuing operations $2.87 $2.97
Add back eps impact of the charge
associated with FAS 123 ( R) 0.13 0.13
-------------- --------------
Diluted earnings per share from
continuing operations excluding the
eps impact of the FAS 123 (R) charge $3.00 $3.10
============== ==============
IRPR#1
SOURCE Marriott International, Inc.
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