Marriott CEO on Q1 results: ‘summer is going to be gangbusters’
- Marriott reported its financial results for the first quarter on Wednesday.
- CEO Tony Capuano discussed Q1 results on CNBC's "Squawk on the Street".
- Shares of the lodging company have recovered 20% since early March.
Marriott International Inc (NASDAQ: MAR) is in the green this morning after the lodging company reported its financial results for the first quarter that handily topped Wall Street expectations.
What Marriott Q1 earnings report tells us
- Net income printed at $377 million that translates to $1.14 per share.
- In Q1 last year, it had posted $11 million in net loss or 3 cents a share.
- Adjusted for one-time items, EPS came in at $1.25 in the recent quarter.
- Revenue shot up 81.3% to $4.20 billion, as per the earnings press release.
- Consensus was for 90 cents of adjusted EPS on $4.17 billion in revenue.
- RevPAR nearly doubled as occupancy went up 64% globally in March.
- Average daily rate topped pre-pandemic levels by 27% in fiscal Q1.
- Added 11,800 rooms globally (roughly) during the first quarter.
Marriott benefitted from the post COVID pent-up demand in its recent financial quarter but the Russia-Ukraine conflict and China lockdowns continue to be a headwind. The stock has recovered roughly 20% since early March.
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Highlights from CEO Capuano’s interview on CNBC
According to CEO Tony Capuano, business will remain strong in the coming months despite inflationary pressures. This morning on CNBC’s “Squawk on the Street”, he said:
We see extraordinarily strong leisure demand, but what gives us continued optimism is the recovery we’re seeing also in groups and business transient, which has been the slowest to recover. Based on our forward booking data, we think summer will be gangbusters.
Also on Wednesday, Marriott declared a cash dividend of 30 cents per share and said it will likely also resume share buybacks later this year. Commenting on the pricing power, the chief executive said:
We think higher prices are quite sticky. After 9/11 and the great recession, it took four to five years for pricing power to really recover. So, it’s remarkable that two years after the pandemic, pricing is meaningfully ahead of 2019 levels.