Marriott Announces Strong 3Q Performance

Marriott International today announced third-quarter earnings that included significant increases in revenue per available room for both its North American and international hotels. North American RevPAR jumped 7.7 percent, compared with the same period in 2003, while international hotels had RevPAR increases of 16 percent. Average daily rate in North America rose 3.9 percent, while occupancy increased 2.6 percent to nearly 75 percent.

J.W. Marriott Jr., chairman and CEO, attributed the positive results to strong demand, including business travel, which allowed for more than minimal rate increases. An increasing amount of RevPAR growth is coming from rate, rather than occupancy, which means greater profits. "Third-quarter North American room rate growth exceeded occupancy growth for the first time since early 2001," Marriott said.

Marriott is the first of the large multi-brand companies to report quarterly earnings, so the positive results are a bellwether for the industry as a whole. The results are the latest evidence that the lodging industry rebound, which began tentatively at the end of 2003, has proven sustainable. The industry turnaround creates more pressure on travel buyers in the midst of negotiations with hotel companies for 2005 negotiated rates.