Marriott International has said it “remains bullish” on its outlook for 2014, after experiencing rising profits and revPAR in the second quarter of the year.
The US-based hotel group posted second quarter net profits of US$192 million, 7% higher than the same period last year. Company revenues also climbed 7% to US$3.48 billion, and the group managed to reduce its expense bill by 6%, leading to a 13% jump in operating profits, which totalled US$316m.
In terms of its hotel operations, Marriott’s revPAR increased 5.8% year-on-year to US$116.63. This was driven by a 1.7% rise in occupancy, to 77.0%, and a 3.5% increase in average daily rates, to US$151.39.
The strongest revPAR growth was seen in the Caribbean and Latin America region, which climbed 10.6% to US$145.15. Asia Pacific hotels increased 5.6% to US$126.51, but European revPAR edged up just 1.6% to US$148.74.
“Results in the quarter exceeded our expectations as worldwide revPAR increased nearly 6%. In North America, strong transient demand drove revPAR higher and room rates rose nearly 4%,” said Arne Sorenson, Marriott’s president & chief executive officer.
For the first half of 2014, Marriott’s net profits climbed 16% to US$364m, while revenues rose 6% to US$6.78bn. And Sorenson said the outlook for the second half of the year is positive.
“We are bullish on the remainder of 2014,” he said. “The strong revPAR growth in the second quarter combined with very strong group bookings for the third quarter gives us the confidence to increase our full year 2014 North American and worldwide revPAR growth guidance to 5-7%.
“We are also increasing our expectations for gross room additions to 7%… based on strong development interest in our brands,” he added.
At the end of the second quarter on 30 June 2014, Marriott International had global portfolio of 4,087 properties totalling 696,926 rooms. This marks growth of 6.2% and 4.6% respectively compared to the same time last year.